Intel Returns to Profitability, Issues Upbeat Forecast

Intel’s earnings in the second quarter of 2023 were stronger than expected, and the microprocessor giant says its comeback is now underway.

The firm posted a net income of $1.5 billion on revenues of $12.9 billion for the quarter ending June 30. That latter figure represents a decline of 15 percent year-over-year (YOY), but the quarter marked the first time since Q3 2022 that Intel was profitable.

“Our Q2 results exceeded the high end of our guidance as we continue to execute on our strategic priorities, including building momentum with our foundry business and delivering on our product and process roadmaps,” Intel CEO Pat Gelsinger said. “We are also well-positioned to capitalize on the significant growth across the AI continuum by championing an open ecosystem and silicon solutions that optimize performance, cost, and security to democratize AI from cloud to enterprise, edge and client.”

The Client Computing Business, which designs and manufactures chipsets for PCs, continues to be Intel’s biggest, with $6.8 billion in revenues in the quarter, a YOY decline of 12 percent but better than expected. Intel says that it continues to see strong demand for the 13th Gen Core chipsets used in most PCs, and it expects to see over 300 PC designs based on this chipset ship this year. The firm also highlighted the integrated AI capabilities coming in its next-generation Core chips.

Most of Intel’s other business units—Data Center and AI ($4 billion in revenues, down 15 percent), Network and Edge ($1.4 billion, down 38 percent), and MobileEye ($454 million, down 1 percent)—all experienced declines in the quarter. But Intel Foundry Services, which Mr. Gelsinger is positioning as the future of the company, saw its revenues jump 307 percent to $232 million.

But it was Intel’s predictions of future gains that most excited Wall Street, sending the company’s stock price up 7 percent in late trading. Revenues in the current quarter will be higher than expected, Intel said, and it remains on track to match TMSC’s mobile chipmaking processes by 2026. But most important, Intel indicated that the PC market will begin to rebound in the second half of 2023.