Intel released its first quarter earnings report after closing bell tonight, posting adjusted earnings of 54 cents per share, non-GAAP revenue of $13.8 billion, and $13.7 billion in GAAP revenue. Net earnings were 42 cents per share Analysts were expecting 47 cents per share in adjusted earnings and $13.8 billion in revenue. Trading on the chip maker’s shares was halted for a time right after the bell pending news, which turned out to be about a new restructuring plan.
Intel sees strength in Data Centers, IoT
Intel said its Client Computing Group’s revenue climbed 2% year over year to $7.5 billion, while its Data Center Group’s revenue grew 9% to $4 billion. Revenue from the Internet of Things Group surged 22% to $651 million, while revenue from the Non-Volatile Memory Solutions Group fell 6% to $557 million. Intel Security Group revenue climbed 12% to $537 million, while Programmable Solutions Group revenue amounted to $359 million.
Management guided for second quarter revenue of $13.5 billion, plus or minus $500 million, and a non-GAAP gross margin of 61%, plus or minus “a couple percentage points.” For the full year, Intel expects revenue to grow in the mid-single digits, which is a decline from their previous guide of mid- to high-single digit growth.
INTC to slash global workforce
Intel also said tonight that it plans to slash 11% of its workforce, which amounts to 12,000 jobs, which it expects to deliver $750 million in savings this year and $ billion in annual run rate savings by the middle of next year. The company will take a one-time $1.2 billion charge relating to the restructuring in the second quarter.
The chip maker also revealed a succession plan for its chief financial officer. The current CFO will transition to a new role overseeing sales, manufacturing and operations after the new CFO is in place. Intel is beginning a formal search process for a new CFO.
As of this writing, trading on shares of Intel was still halted due to the release of the restructuring news.