What's Happening With Intel Shares on Friday?

Intel Corporation (NASDAQ: INTC) shares are seeing an increase on Friday following the announcement of its 2024 third-quarter earnings, which exceeded expectations. The company also shared advancements in its significant $10 billion cost reduction plan shortly after the market closed on Thursday.

Recent Developments: In its latest earnings report, Intel posted a loss of 46 cents per share, which fell short of the analyst consensus estimate of a loss of 2 cents per share. On the sales front, the company recorded revenues of $13.28 billion, representing a 6% decline from the previous year, yet surpassing analysts' predictions of $13.02 billion.

Intel provided a comprehensive breakdown of its third-quarter performance:

• $7.3 billion from the Client Computing Group
• $3.3 billion from Data Center and Artificial Intelligence (AI)
• $1.5 billion from Network and Edge
• $4.4 billion from Intel Foundry
• $1.03 billion from other revenue sources

However, intersegment eliminations resulted in a loss of $4.3 billion.

Looking ahead, Intel issued guidance for the fourth quarter of 2024, anticipating earnings per share (EPS) of 12 cents, compared to analyst expectations of 8 cents. The company is projecting sales between $13.3 billion and $14.3 billion, also above analysts' expectations of $13.66 billion.

Pat Gelsinger, Intel's CEO, commented, "Our Q3 results highlight the solid progress we are making against the plan we outlined last quarter to reduce costs, simplify our portfolio, and enhance organizational efficiency. We exceeded the midpoint of our revenue guidance and are urgently repositioning ourselves for sustainable value creation in the future."

The cost reduction initiative includes organizational realignment along with reductions in headcount, operating expenses, and capital expenditures. As part of this, the company recognized restructuring charges totaling $2.8 billion.

David Zinsner, the company's CFO, noted that “the restructuring charges significantly impacted Q3 profitability,” and assured that “the measures we implemented this quarter pave the way for improved profitability and strengthened liquidity.”

Analyst Reactions: Following the earnings report, several analysts adjusted their price targets for Intel:

• Needham analyst Quinn Bolton reaffirmed a Hold rating on Intel.
• Rosenblatt analyst Hans Mosesmann maintained a Sell rating but raised the price target from $17 to $20.
• Benchmark analyst Cody Acree reiterated a Hold rating.
• Baird analyst Tristan Gerra kept a Neutral rating and adjusted the price target from $20 to $25.

Current Share Performance: As of now, Intel shares are rising by 8.32%, trading at $23.31, according to data from Benzinga Pro.

Image: Image via Shutterstock

Intel, Earnings, Shares