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Intel reports record second quarter

Intel chief claims to have raised the bar on performance and predicts record year for the chip maker after record second-quarter revenue

Intel has reported second-quarter revenue of $14.8bn, an increase of 14% on the equivalent period a year ago, excluding Intel Security, while profit was up 111% to $2.8bn.

The firm’s security division was spun out as an independent pure-play cyber security company under the McAfee brand and the leadership of chief executive Chris Young at the start of the quarter.

The strong quarter was driven by a 12% increase in revenue to $8.2bn for its client computing group, which includes platforms for notebooks, desktops, tablets, phones, wireless and mobile communications, and a 16% increase in revenues for its data-centric businesses, which include Intel’s datacentre and internet of things (IoT) groups.

Within the client computing group, notebook revenue was up 20% from a year ago, while desktop processor revenue fell by 3%. Overall, Intel sold 3% more units in the quarter compared with last year’s second quarter, and average selling prices rose by 8%.

The company’s top-performing data-centric business was the non-volatile memory solutions group, which achieved 58% growth in revenue to $874m, followed by the IoT group with 26% growth to $720m for the quarter.

Intel said it generated about $4.7bn in cash from operations, paid dividends of $1.3bn, and used $1.3bn to repurchase 36 million shares of stock.

“We feel great about where we are relative to our three-year plan and heading into the second half,” said Intel CFO Bob Swan. “Intel’s transformation continues in the third quarter, when we expect to complete our planned acquisition of Mobileye.

“Based on our strong first-half results and higher expectations for the PC business, we are raising our full-year revenue and EPS forecast.”

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Intel raised its full-year revenue outlook by $1.3bn to $61.3bn and raised its full-year earnings-per-share outlook by $0.10 to $2.66.

During the quarter, the company launched the Intel Core X-Series family of processors, which are its highest-performance chips to date, to be used for advanced gaming and virtual reality, for example.

Intel also launched its Xeon Scalable processors, which it says offer datacentre customers huge performance gains for artificial intelligence (AI) and other data-intensive workloads.

“Q2 was an outstanding quarter, with revenue and profits growing double digits over last year,” said Intel CEO Brian Krzanich.

“We also launched new Intel Core, Xeon and memory products that reset the bar for performance leadership, and we are gaining customer momentum in areas like AI and autonomous driving. With industry-leading products and strong first-half results, we are on a clear path to another record year.”

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