IoT growth helps Intel offset falling PC business
April 16, 2015
Growth in Intel’s IoT activity has offset falling revenue it what was once its core PC business, according to the company’s first quarter earnings statement published this week.
Intel reported first-quarter revenue of $12.8bn, operating income of $2.6bn (up four per cent year-on-year), net income of $2.0bn and EPS of 41 cents. The company generated approximately $4.4bn in cash from operations, paid dividends of $1.1bn and used $750m to repurchase 21 million shares of stock.
"Year-over-year revenues were flat, with double-digit revenue growth in the data centre, IoT and memory businesses offsetting lower than expected demand for business desktop PCs," said Intel CEO Brian Krzanich. "These results reinforce the importance of continuing to execute our growth strategy."
The client computing group posted revenue of $7.4bn, down 16 per cent sequentially and down 8 per cent year-over-year. The data centre group’s revenue of $3.7bn was down 10 per cent sequentially and up 19 per cent year-over-year. This was similar to the IoT group, which saw a revenue of $533m, down 10 per cent sequentially and up 11 per cent year-over-year. The software and services operating segments revenue of $534m was down four per cent sequentially and down three per cent year-over-year.
The company is predicting that the overall flat revenue will be reflected for the full 2015 calendar year, during which it is estimating it will spend just short of $20bn on R&D and mergers and acquisitions.