Intel (INTC) shares jumped higher Friday after the chipmaker posted stronger-than-expected third quarter earnings, powered by surprising PC demand, and unveiled plans for big job cuts that offset another pullback in its full-year sales forecast.
Intel’s adjusted bottom line for the September quarter was pegged at 59 cents per share, well ahead of the Street consensus forecast, while revenues fell 15% to $15.3 billion, just ahead of analysts’ estimates.
Client computing revenue fell 17% from last year to $8.1 billion, Intel said, but that figure topped Street forecasts of around $7.6 billion. Data Center and AI division sales were down 27% to $4.2 billion. Network and Edge Group sales were up 14% from last year to $2.3 billion, but were essentially flat to the previous quarter.
Looking into the final months of the year, Intel said it sees revenues in the region of $63.5 billion, down form its prior forecast of between $65 billion and $68 billion. The group lowered its forecast for PC demand, as well, for both this year and next, while detailing cost reduction plans it said would save $3 billion in 2023 and a further $8 billion to $10 billion by 2025.
“We are responding to the current environment by taking aggressive actions to reduce costs while mindfully protecting the investments needed to accelerate our transformation,” CEO Pat Gelsinger told investors on a conference call late Thursday. “Inclusive in our efforts will be steps to optimize our headcount. These are difficult decisions affecting our loyal Intel family, but we need to balance increased investment with efficiency measures.”
Intel shares, which have fallen more than 50% so far this year, were marked 4.45% higher in pre-market trading to indicate an opening bell price of $27.44 each.
Earlier this week, Intel got a boost from the better-than-expected final IPO price of its self-driving division, Mobileye Global (MBLY) , which listed on the Nasdaq Global Select Market at a price of $21 per share, a level that raised $861 million and values the the Israel-based group at around $16.7 billion.