Intel's most important business is slowing down, stock drops
Reuters/Albert Gea
It's a beat on earnings and a match on revenues. But it reported another slow down in its data center group, which has been the company's biggest growth driver, and the stock is down 3% in after hours.
Here are the most important numbers:
- EPS (non-GAAP): $0.59 per share vs. $0.53 per share estimated
- Revenue: $13.53 billion vs. $13.54 billion estimated (up 3% year-over-year)
Intel's client computing group, comprised of its PC and mobile units, had $7.3 billion in revenue, down 3% from last year.
Its data center group, which has been driving Intel's growth, slowed down a bit this quarter, growing 5% year-over-year for $4 billion in revenue. That's three straight quarters of a slow down for its data center group, as it grew 9% in the first quarter and 11% in the fourth quarter of 2015, respectively.
Intel gave revenue guidance of $14.9 billion next quarter, slightly higher than the $14.6 billion street estimates.
Intel went through a number of big changes in the second quarter.
It rolled out one of its biggest layoff plans in history, which will cut 12,000 jobs, or 11% of the total workforce, by mid-2017. Intel said the restructuring is "solidly on-track," leading the company's move to the post-PC era that focuses more on data center and connected device chips.
It also canceled its upcoming Atom chips for smartphones and tablets, essentially taking a big step away from the mobile chip business, a segment that cost the company billions of dollars in losses over the past few years.
Not everyone's happy about the changes taking place at the company. According to about a dozen current and former employees we spoke to, Intel's targeting old timers in its latest round of layoffs in order to bring in younger, fresher talent to the company.
- A couple accidentally shipped their cat in an Amazon return package. It arrived safely 6 days later, hundreds of miles away.
- A centenarian who starts her day with gentle exercise and loves walks shares 5 longevity tips, including staying single
- 2 states where home prices are falling because there are too many houses and not enough buyers
- "To sit and talk in the box...!" Kohli's message to critics as RCB wrecks GT in IPL Match 45
- 7 Nutritious and flavourful tiffin ideas to pack for school
- India's e-commerce market set to skyrocket as the country's digital economy surges to USD 1 Trillion by 2030
- Top 5 places to visit near Rishikesh
- Indian economy remains in bright spot: Ministry of Finance