Non GAAP Results

  • Revenue $12.9 billion, up $2.6 billion, 25 percent year-over-year
  • Gross margin of 62 percent, down 1 percentage point year-over-year
  • Operating income $4.3 billion, up $862 million, 25 percent year-over-year
  • Net income $3.3 billion, up $830 million, 34 percent year-over-year
  • EPS 59 cents, up 16 cents, 37 percent year-over-year

 

GAAP Results

  • Revenue $12.8 billion, up $2.5 billion, 25 percent year-over-year
  • Gross margin of 61 percent, down 2 percentage points year-over-year
  • Operating income $4.2 billion, up $710 million, 21 percent year-over-year
  • Net income $3.2 billion, up $718 million, 29 percent year-over-year    
  • EPS 56 cents, up 13 cents, 30 percent year-over-year

 

 

SANTA CLARA, Calif., April 19, 2011 – Intel Corporation today reported record EPS and revenue on both a GAAP and non-GAAP basis.

 

On a non-GAAP basis, revenue was $12.9 billion, operating income was $4.3 billion, net income was $3.3 billion, and EPS was 59 cents. On a GAAP basis, the company reported first-quarter revenue of $12.8 billion, operating income of $4.2 billion, net income of $3.2 billion, and EPS of 56 cents.

 

The company generated approximately $4.0 billion in cash from operations, paid cash dividends of $994 million, and used $4.0 billion to repurchase 189 million shares of common stock.

 

“The first-quarter revenue was an all-time record for Intel fueled by double digit annual revenue growth in every major product segment and across all geographies,” said Paul Otellini, Intel president and CEO. “These outstanding results, combined with our guidance for the second quarter, position us to achieve greater than 20 percent annual revenue growth.”

 

Non-GAAP Financial Comparison

Quarterly Results

Q1 2011

vs. Q4 2010

vs. Q1 2010

Revenue

$12.9 billion

up 12%

up 25%

Operating Income

$4.3 billion

up 7%

up 25%

Net Income

$3.3 billion

up 3%

up 34%

Earnings Per Share

59 cents

up 5%

up 37%

Non-GAAP results exclude certain acquisition accounting impacts and expenses related to acquisitions and the related income tax effects of these charges.

 

GAAP Financial Comparison

Quarterly Results

Q1 2011

vs. Q4 2010

vs. Q1 2010

Revenue

$12.8 billion

up 12%

up 25%

Operating Income

$4.2 billion

up 3%

up 21%

Net Income

$3.2 billion

flat

up 29%

Earnings Per Share

56 cents

flat

up 30%

 

Q1 2011 Key Financial Information (GAAP)

  • PC Client Group revenue up 17 percent, Data Center Group revenue up 32 percent, other Intel architecture group revenue up 70 percent, and Intel® Atom™ microprocessor and chipset revenue of $370 million up 4 percent, all year-over-year.
  • The average selling price (ASP) for microprocessors was up sequentially.
  • Gross margin was 61 percent.
  • R&D plus MG&A spending of $3.7 billion, slightly higher than the company’s expectation.
  • The net gain of $213 million from equity investments and interest and other, consistent with the company’s expectation.
  • The effective tax rate was 28 percent, in-line with the company’s outlook of 29 percent.
  • The company used $4.0 billion to repurchase 189 million shares of common stock.
  • During the quarter, the company closed the acquisitions of Infineon Wireless Solutions and McAfee, Inc.  The combination of both acquisitions contributed revenue of $496 million.
  • The first quarter of 2011 had 14 weeks of business versus the typical 13 weeks, as the company realigned its fiscal year with the calendar year.

 

Business Outlook

Intel’s Business Outlook does not include the potential impact of any mergers, acquisitions, divestitures or other business combinations that may be completed after April 19.

 

Q2 2011 (GAAP, unless otherwise stated)

  • Revenue: $12.8 billion, plus or minus $500 million.
  • Non-GAAP revenue: Excluding certain acquisition related accounting impacts, the revenue forecast is $12.85 billion, plus or minus $500 million.
  • Gross margin percentage: 61 percent, plus or minus a couple percentage points.
  • Non-GAAP gross margin: Excluding certain accounting impacts and expenses related to acquisitions, the gross margin forecast is 62 percent plus or minus a couple percentage points.
  • R&D plus MG&A spending: approximately $3.9 billion.
  • Amortization of acquisition related intangibles: approximately $75 million.
  • Impact of equity investments and interest and other: gain of approximately $50 million.
  • Depreciation: approximately $1.2 billion.

 

Full-Year 2011 (GAAP, unless otherwise stated)

  • Gross margin percentage: 63 percent, plus or minus a few percentage points.
  • Non-GAAP gross margin: excluding certain accounting impacts and expenses related to acquisitions, the gross margin forecast is 64% plus or minus a few points.
  • Spending (R&D plus MG&A): $15.7 billion, plus or minus $200 million.
  • Amortization of acquisition related intangibles:  approximately $260 million.
  • Tax rate: approximately 29 percent for the second, third and fourth quarters.
  • Depreciation: $5 billion, plus or minus $100 million.
  • Capital spending: $10.2 billion, plus or minus $400 million.
  • 2011 will have 53 weeks of business versus the typical 52 weeks, as the company realigns its fiscal year with the calendar year.

 

For additional information regarding Intel’s results and Business Outlook, please see the CFO commentary at: www.intc.com/results.cfm.

 

Status of Business Outlook
During the quarter, Intel’s corporate representatives may reiterate the Business Outlook during private meetings with investors, investment analysts, the media and others. From the close of business on June 3 until publication of the company’s second-quarter earnings release, Intel will observe a “Quiet Period” during which the Business Outlook disclosed in the company’s news releases and filings with the SEC should be considered as historical, speaking as of prior to the Quiet Period only and not subject to an update by the company.

 

Risk Factors
The above statements and any others in this document that refer to plans and expectations for the second quarter, the year and the future are forward-looking statements that involve a number of risks and uncertainties. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “may,” “will,” “should,” and their variations identify forward-looking statements.  Statements that refer to or are based on projections, uncertain events or assumptions also identify forward-looking statements.   Many factors could affect Intel’s actual results, and variances from Intel’s current expectations regarding such factors could cause actual results to differ materially from those expressed in these forward-looking statements. Intel presently considers the following to be the important factors that could cause actual results to differ materially from the company’s expectations.

  • Demand could be different from Intel's expectations due to factors including changes in business and economic conditions, including supply constraints and other disruptions affecting customers; customer acceptance of Intel’s and competitors’ products; changes in customer order patterns including order cancellations; and changes in the level of inventory at customers. Potential disruptions in the high technology supply chain resulting from the recent disaster in Japan could cause customer demand to be different from Intel’s expectations.
  • Intel operates in intensely competitive industries that are characterized by a high percentage of costs that are fixed or difficult to reduce in the short term and product demand that is highly variable and difficult to forecast. Revenue and the gross margin percentage are affected by the timing of Intel product introductions and the demand for and market acceptance of Intel's products; actions taken by Intel's competitors, including product offerings and introductions, marketing programs and pricing pressures and Intel’s response to such actions; and Intel’s ability to respond quickly to technological developments and to incorporate new features into its products.
  • The gross margin percentage could vary significantly from expectations based on capacity utilization; variations in inventory valuation, including variations related to the timing of qualifying products for sale; changes in revenue levels; product mix and pricing; the timing and execution of the manufacturing ramp and associated costs; start-up costs; excess or obsolete inventory; changes in unit costs; defects or disruptions in the supply of materials or resources; product manufacturing quality/yields; and impairments of long-lived assets, including manufacturing, assembly/test and intangible assets.
  • Expenses, particularly certain marketing and compensation expenses, as well as restructuring and asset impairment charges, vary depending on the level of demand for Intel's products and the level of revenue and profits.
  • The tax rate expectation is based on current tax law and current expected income. The tax rate may be affected by the jurisdictions in which profits are determined to be earned and taxed; changes in the estimates of credits, benefits and deductions; the resolution of issues arising from tax audits with various tax authorities, including payment of interest and penalties; and the ability to realize deferred tax assets.
  • Gains or losses from equity securities and interest and other could vary from expectations depending on gains or losses on the sale, exchange, change in the fair value or impairments of debt and equity investments; interest rates; cash balances; and changes in fair value of derivative instruments.
  • The majority of Intel’s non-marketable equity investment portfolio balance is concentrated in companies in the flash memory market segment, and declines in this market segment or changes in management’s plans with respect to Intel’s investments in this market segment could result in significant impairment charges, impacting restructuring charges as well as gains/losses on equity investments and interest and other.
  • Intel's results could be affected by adverse economic, social, political and physical/infrastructure conditions in countries where Intel, its customers or its suppliers operate, including military conflict and other security risks, natural disasters, infrastructure disruptions, health concerns and fluctuations in currency exchange rates.
  • Intel’s results could be affected by the timing of closing of acquisitions and divestitures.
  • Intel's results could be affected by adverse effects associated with product defects and errata (deviations from published specifications), and by litigation or regulatory matters involving intellectual property, stockholder, consumer, antitrust and other issues, such as the litigation and regulatory matters described in Intel's SEC reports. An unfavorable ruling could include monetary damages or an injunction prohibiting us from manufacturing or selling one or more products, precluding particular business practices, impacting Intel’s ability to design its products, or requiring other remedies such as compulsory licensing of intellectual property.

 

A detailed discussion of these and other factors that could affect Intel’s results is included in Intel’s SEC filings, including the report on Form 10-K for the fiscal year ended Dec. 25, 2010.

 

Earnings Webcast
Intel will hold a public webcast at 2:30 p.m. PDT today on its Investor Relations web site at www.intc.com. A webcast replay and MP3 download will also be made available on the site.

 

Intel plans to report its earnings for the second quarter of 2011 on Wednesday, July 20, 2011.  Immediately following the earnings report, the company plans to publish a commentary by Stacy J. Smith, vice president and chief financial officer at www.intc.com/results.cfm.  A public webcast of Intel’s earnings conference call will follow at 2:30 p.m. PDT at www.intc.com.

 

About Intel
Intel (NASDAQ: INTC) is a world leader in computing innovation. The company designs and builds the essential technologies that serve as the foundation for the world’s computing devices. Additional information about Intel is available at newsroom.intel.com and blogs.intel.com.

 

Intel and the Intel logo are trademarks of Intel Corporation in the United States and other countries.

 

* Other names and brands may be claimed as the property of others.

Whether taking part in the Campaign for Commercial-Free Childhood’s “Screen-Free Week” this week , or engaging in “screen-time” together with your “digital native”,  parents and children alike can enhance their lives with mobile technology by discussing family usage and guidelines together according to Anna Post of The Emily Post Institute. At the Mom 2.0 Summit this past weekend, Intel shared additional findings from its recent “Mobile Etiquette” survey that revealed how parents and children use mobile technology around each other and its impact on family relationships. According to the survey, nearly 40 percent of parents admit they sometimes spend too much time using a mobile device in front of their children, while 42 percent of children think their parents need to disconnect more when they are at home. Find additional survey findings from Intel and tips from etiquette expert Anna Post here.

NEWS HIGHLIGHTS:

  • Intel® announces eight Supplier Continuous Quality Improvement Award (SCQI) winners.
  • Intel management shares company direction for 2011

 

 

SANTA CLARA, Calif., April 19, 2011 -- Eight companies were honored today with Intel® Corporation's prestigious Supplier Continuous Quality Improvement (SCQI) award for 2010. The award, handed out at Intel's Supplier Day, recognizes the organization's most accomplished suppliers, distinguishing world-class, outstanding quality performance of companies that provide products and services imperative to Intel's business success.

 

Supplier Day serves as a critical venue for suppliers and Intel's management to collaborate, learn and interact to build the world's best supply chain. Sharing the company direction reinforces the technology and manufacturing organization's focus on cost effective innovation, technology leadership and agile, sustainable execution.

 

"Our industry is experiencing significant changes that make it even more important to partner with outstanding suppliers to deliver leading-edge technology to our customers," said William Holt, senior vice president and general manager of Intel's Technology and Manufacturing Group. "We are delighted to recognize the level of excellence demonstrated by the SCQI winners."

 

"In this industry companies can't rest on last year's quality performance; continuous improvement is what differentiates good companies from great companies," said Brian Krzanich, senior vice president and general manager of Intel's Manufacturing and Supply Chain. "The eight companies honored with this award demonstrated improvement in the important areas of innovation, agility, customer responsiveness and environmental sustainability."

 

The SCQI award is part of Intel's SCQI program, which encourages Intel's key suppliers to strive for excellence and continuous improvement. To qualify for SCQI status, suppliers must score at least 95 percent on a report card that assesses performance and ability to meet cost, quality, availability, delivery, technology and environmental, social and governance goals. Suppliers must also achieve 90 percent or greater on a challenging improvement plan and demonstrate solid quality and business systems. Additional information about the SCQI program is available at www.intel.com/go/quality.

 

The SCQI winners provide Intel with the following products or services:

 

  • DISCO Corporation supplies blade dicing and laser saws, wafer thinning and polishing systems.
  • Hitachi High-Technologies Corporation supplies etching systems, field emission and critical dimension scanning electron microscopes, and defect inspection systems.
  • Hitachi Kokusai Electric Inc. supplies diffusion furnaces.
  • JSR Corporation supplies advanced photoresists, packaging materials and CMP consumables.
  • Senju Metal Industry Co., Ltd. supplies electronic interconnect materials.
  • SHINKO ELECTRIC INDUSTRIES CO., LTD. supplies plastic laminated packages and heat spreaders.
  • SUMCO Corporation supplies 200mm and 300mm polished and epitaxial silicon wafers.
  • Tokyo Electron Limited supplies semiconductor production equipment.

 

About Intel
Intel (NASDAQ: INTC) is a world leader in computing innovation. The company designs and builds the essential technologies that serve as the foundation for the world’s computing devices. Additional information about Intel is available at newsroom.intel.com and blogs.intel.com.

 

Intel is a trademark of Intel Corporation in the United States and other countries.

 

* Other names and brands may be claimed as the property of others.

 

SANTA CLARA, Calif., April 19, 2011 – Intel® Corporation announced 16 recipients of the Preferred Quality Supplier (PQS) award. These companies are distinguished from thousands of suppliers that work with Intel and have exceeded high expectations and tough performance goals while demonstrating an industry-leading commitment to quality.

 

In addition to the PQS award, Intel celebrates extraordinary supplier accomplishments with the new Achievement Award. This award recognizes supplier achievements across the areas of cost, quality, availability, technology, sustainability and customer satisfaction. Four suppliers are the recipients of this award for performance in 2010.

 

"The recipients of the 2010 Intel Preferred Quality Supplier award have clearly demonstrated their excellence," said Jacklyn Sturm, vice president of Intel's Technology and Manufacturing Group and general manager of Worldwide Materials. "This high level of performance is displayed not only in the world-class quality and superb technology of their products and services, but also in the new bar they have helped Intel achieve in customer responsiveness and total supply chain sustainable business practices."

 

"Intel is delighted to recognize our Preferred Quality Suppliers and their exceptional performance over the past year," said Robert Bruck, vice president of Intel's Technology and Manufacturing Group and general manager of Technology Manufacturing Engineering. "These suppliers have distinguished themselves as market leaders and have made a substantial contribution to Intel's technology, affordability and sustainability leadership."

 

The PQS award is part of Intel's Supplier Continuous Quality Improvement (SCQI) program that encourages suppliers to innovate and continually improve. To qualify for PQS status, suppliers must score 80 percent on a report card that assesses performance and ability to meet cost, quality, availability, delivery, technology and environmental, social and governance goals. Suppliers must also achieve 80 percent or greater on a challenging improvement plan and demonstrate solid quality and business systems. Additional information about the SCQI program is available at www.intel.com/go/quality.

 

The PQS winners provide Intel with the following products and services:

 

  • Applied Materials Inc. supplies semiconductor manufacturing equipment and support services.
  • ASML supplies semiconductor lithography equipment.
  • Cabot Microelectronics Corporation supplies CMP slurries.
  • Daewon Semiconductor Packaging Industrial Company Ltd. supplies handling media.
  • DAIFUKU supplies Fab automated material handling systems.
  • Dai Nippon Printing Co., Ltd. supplies advanced photomasks.
  • FUJIFILM Electronic Materials supplies advanced chemistry and equipment for semiconductor device manufacturing.
  • Mitsubishi Gas Chemical Company Inc. supplies chemicals for semiconductor device manufacturing.
  • Moses Lake Industries (Tama Chemicals) supplies specialized ultra-high purity chemicals.
  • Murata Manufacturing Co., Ltd. supplies multilayer ceramic capacitors, inductors and electromagnetic interference components.
  • Nikon Corporation supplies lithography scanners and steppers.
  • Rofin-Baasel supplies laser mark equipment.
  • Siltronic supplies polished and epitaxial silicon wafers.
  • STATS ChipPAC Ltd. supplies full turnkey packaging and test services.
  • Taiyo Yuden Co., Ltd. supplies multilayer ceramic capacitors, inductors and electromagnetic interference components.
  • Taiwan Semiconductor Manufacturing Company, Ltd. supplies foundry services.

 

The Achievement Award winners are the following:

 

  • Advantest Corporation, test equipment, awarded for velocity and availability.
  • Gemtek Technology Co., Ltd., wireless products, awarded for customer satisfaction.
  • Grohmann Engineering, assembly equipment, awarded for affordability.
  • Hirata Corporation, automation equipment, awarded for breakthrough technology.

 

About Intel
Intel (NASDAQ: INTC) is a world leader in computing innovation. The company designs and builds the essential technologies that serve as the foundation for the world’s computing devices. Additional information about Intel is available at newsroom.intel.com and blogs.intel.com.

 

Intel is a trademark of Intel Corporation in the United States and other countries.

 

*Other names and brands may be claimed as the property of others.

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