Chipmaker Intel (INTC) late Thursday smashed Wall Street’s targets for the third quarter, though its fourth-quarter guidance missed views. Intel stock surged in extended trading.
The Santa Clara, Calif.-based company earned an adjusted 23 cents a share on sales of $13.65 billion in the September quarter. Analysts polled by FactSet had expected earnings of 2 cents a share on sales of $13.17 billion. In the year-earlier period, Intel lost 46 cents a share on sales of $13.28 billion.
For the current quarter, Intel forecast adjusted earnings of 8 cents a share on sales of $13.3 billion, based on the midpoint of its outlook. Analysts were modeling earnings of 10 cents a share on sales of $13.42 billion in the fourth quarter. In the year-ago quarter, Intel earned 13 cents a share on sales of $14.26 billion.
In after-hours trading on the stock market today, Intel stock rose more than 7% to 41.08. During the regular session Thursday, Intel stock advanced 3.4% to close at 38.16.
“Our Q3 results reflect improved execution and steady progress against our strategic priorities,” Chief Executive Lip-Bu Tan said in a news release.
He added, “AI is accelerating demand for compute and creating attractive opportunities across our portfolio, including our core x86 platforms, new efforts in purpose-built ASICs and accelerators, and foundry services.”
Intel’s PC chip business was the top performer in the third quarter, with sales up 5% year over year to $8.5 billion. Meanwhile, sales of data center and AI chips slipped 1% to $4.1 billion.
Nvidia, SoftBank, U.S. Invest In Intel
On Sept. 18, Intel stock broke out of a 29-week consolidation pattern at a buy point of 27.55, according to IBD MarketSurge charts. It jumped 22.8% to close at 30.57 on news that AI chip designer Nvidia (NVDA) was investing $5 billion in Intel stock as part of a collaboration.
On Aug. 22, Intel announced that the U.S. government would make an $8.9 billion investment in Intel in exchange for a 9.9% stake in the company. Just days earlier, Japan’s SoftBank Group announced a $2 billion investment in Intel stock.
The storied chipmaker is in turnaround mode under its new chief executive officer. Tan took over the top job on March 18.
STMicroelectronics Guides Low
Earlier Thursday, European chipmaker STMicroelectronics (STM) disappointed with its fourth-quarter guidance, though it beat views with its Q3 results. STMicro stock dropped 13.3% to close at 25.26.
The chipmaker earned 26 cents per U.S. share on sales of $3.19 billion in the third quarter. Analysts had been looking for earnings of 22 cents a share on sales of $3.17 billion. However, on a year-over-year basis, STMicro’s earnings dropped 30% while sales declined 2%. It has now reported eight straight quarters of declining sales and earnings.
For the current quarter, STMicro forecast sales of $3.28 billion, based on the midpoint of its guidance. Analysts were looking for $3.34 billion. In Q4 last year, it generated sales of $3.32 billion.
Follow Patrick Seitz on X at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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