Intel Corporation (NASDAQ:INTC) is expected to post its fourth quarter earnings and outlook for the first quarter of 2014 on January 16th 2014. A vital announcement from Intel will come regarding its first quarter outlook as there will be some seasonal decline so the basis of comparison would be year on year first quarter results.  On comparing the number on a year over year basis, both gross margin and revenue are expected to increase, says a report from DailyFinance.

intel logo

Q1 outlook to get more attention

Intel Corporation (NASDAQ:INTC) should have better capacity utilization in the first quarter of 2014 compared to the first quarter 2013, when margin came in at a multi year low of 56%. Gross margin is expected to be more in the 60% range.

Intel’s core data center segments are expected to have an inclusive growth, and the data center group, which constitutes 50% of operating margin, would enhance the top and bottom lines.

PC sales are expected to be upbeat assisted by Intel’s upcoming low cost Bay Trail-M, which would help the PC maker to take back low-end PC share from competitor Advanced Micro Devices (AMD).

In the coming quarter, Intel would start rolling out its Bay Trail for Android tablets, which would affect the gross margin of the company due to huge rebates associated with them.  The gross margin of the company would take a hit of 1.5%, and the effect would be more in Q1 and Q2 before leveling off.

Intel’s enterprise segment of its data center business may not increase at a rapid rate year over year basis as forecasted by management at its analyst meet.

Intel to post in-line results

Analysts and investors are expecting fourth quarter to bring some stabilization in the PC demand environment, and Intel Corporation (NASDAQ:INTC) is expected to perform in line with the expectations.

In the third quarter, Intel witnessed rapid growth in cloud, storage and high performance computing as revenue in the segments surged 40%, 20% and 27% respectively. In the fourth quarter, the chip maker is expecting a year over year growth in data center revenue.

The upcoming Merrifield platform, which is based on the Silvermont platform, is expected to increase the smartphone market share of the company, in the quarter ahead. Intel has started selling multimode voice and data LTE baseband solutions, in fall 2013. Presently, Intel has a negligible share in the smartphone market, and the competition is tough, but the analysts are expecting the company to upgrade its portfolio.