INTEL CORP Quarterly Report for Q1 Ended Mar 30, 2019

Summary

Intel Corporation reported flat revenue of $16.1 billion for the first quarter of 2019, matching the prior year's performance. This stability was driven by a 4% increase in the PC-centric business, largely due to higher average selling prices on premium products, which offset a 5% decline in data-centric businesses. The decrease in data-centric revenue was attributed to a slowdown in the data center market and persistent pricing pressure on NAND memory. Despite flat revenue, gross margins and operating income declined due to the ongoing ramp of the 10nm process technology and lower memory product pricing. However, the company managed operating expenses effectively, partially offsetting the gross margin compression. Intel generated $5.0 billion in cash flow from operations and returned $3.9 billion to stockholders through dividends and share buybacks, demonstrating a continued commitment to shareholder returns.

Key Highlights

• 1Total revenue remained flat at $16.1 billion year-over-year.
• 2PC-centric business revenue increased by 4%, driven by higher average selling prices (ASPs) from a richer product mix.
• 3Data-centric businesses saw a 5% revenue decrease, influenced by a slowing data center market and pressure on NAND pricing.
• 4Gross margin declined due to the 10nm process node ramp and memory pricing pressures, partially offset by operating expense leverage.
• 5Generated $5.0 billion in cash flow from operations.
• 6Returned $3.9 billion to stockholders via $1.4 billion in dividends and $2.5 billion in stock repurchases.
• 7Exiting the 5G smartphone modem business while continuing to invest in 5G network infrastructure.

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