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Intel returns to profitability after two quarters of losses
- fatfingerd 3y agoBy cost cutting measures, replacing the unrealistic dividends phase.. I have no idea why a ex-monopoly taking every action it can think of for accelerating its descent in market share would be seen positively for getting to barely profitable by steps that are no doubt sacrificing future sales.
- atomicnumber3 3y agoThe market is weird. It might have jumped because the market was pricing in a faster decline and it beat expectations, causing a correction. It could also be because earnings reports are times of higher volatility for a stock, and people will use derivatives to make certain bets around it. And then the earnings results can cause them to take decisive action to exit those positions, which might not be happening in the spot market but the spot market can feel the ripple effects of big movements in derivatives. Or maybe a bunch of meme investors are buying intel because it had good news and there's nothing more sophisticated than that. The market is weird, and it's especially weird on short time scales. Let's wait a week and see where they land.
- deleted 3y ago[deleted]
- dwallin 3y agoBecause much of investor behavior is (arguably rationally) not driven by business fundamentals, but how they assume other investors will act. This can lead to counterintuitive and self-fulfilling group think behavior where the metrics might drive the stock price because of an incorrect perception that others value that metric, regardless of actual sentiment.
- downrightmike 3y agoThey've been promoting MBAs to leadership for years, it lead to the down turn and apparently they've figured out a new financial gimmick.
- rossdavidh 3y agoTaking devil's advocate position here: 1) dividend was not (any longer?) rational, since they needed to reinvest in production process improvements; this is therefore a good CEO decision, which gives confidence to stock owners that CEO can do what needs to be done 2) "five nodes in four years", i.e. acceleration to catch up in process capability, is said to be on track, which (if actually true) is good news 3) this was the "pain for future gain" part of Gelsinger's turnaround plan, so if they can actually make a profit even during this phase, that is good news Not sure if I believe any of this, but that's my take on why it might be reason to buy the stock. Not that I am, in fact, actually buying the stock.
- bratao 3y agoI've always been a fan of AMD, but I must admit, Intel is making some impressive strides in the Machine Learning field, especially with tools like OpenVINO. The process of converting models to ONNX and running them in an accelerated manner on Intel GPUs has become significantly easier compared to using ROCm. If Intel continues on this trajectory, it wouldn't be a shocker to see them leapfrog AMD and give NVIDIA a run for their money.
- bogota 3y agoIn the last year we made a 180 from growth at all costs to profit at all costs. Would be crazy if the market just valued consistent sustainable growth but im sure some economist would tell me this is stupid
- 2OEH8eoCRo0 3y agoI wish they'd let me buy an Arc A310.
- ac29 3y agoDoes it have to be A310? There are a couple models of A380 available at Newegg at similar prices to what the A310 was supposedly selling for in other regions.
- synergy20 3y agowhat does openvino run on that is accessible to normal developers? amd has GPU cards for me to use and mi250 mi300 for data centers Nvidia has more of those. I'd like to have hardware to play with oneapi,openvino,but do not know where the hardware is
- mepian 3y agoAny Intel Arc GPU will run it, as far as I know. I bought an A750 for myself to experiment with Level Zero/SPIR-V and SYCL.
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- nashashmi 3y agoSo every sale went down? And the stock still went up because profits went up?
- gnicholas 3y agoLikely the lower sales were already priced into the stock price, and it was the stronger-than-expected forecast that caused the stock bump.
- LordShredda 3y agoImagine being down 15% YoY and STILL making 12.9 billion
- HDThoreaun 3y agoIntel made money this quarter, but only because of a $2 billion dollar tax rebate. Without that they're still losing money.
- sixhobbits 3y agoIs this an accounting trick to look profitable or is it normal and reasonable? > Effective January 2023, Intel increased the estimated useful life of certain production machinery and equipment from five years to eight years. When compared to the estimated useful life in place as of the end of 2022, Intel expects total depreciation expense in 2023 to be reduced by $4.2 billion. Intel expects this change will result in an approximately $2.5 billion increase to gross margin, a $400 million decrease in R&D expenses and a $1.3 billion decrease in ending inventory values.
- qwerty3344 3y agofwiw Google did the same trick with their servers
- metaphor 3y agoLikewise Nvidia...buried in supplemental CFO commentary[1] circa FY23 Q4: > Starting in fiscal 2024, we are extending the useful lives of a majority of our servers, storage, and network equipment from three years to a range of four to five years, and assembly and test equipment from five to seven years. As a result, we expect favorable impact to operating income of approximately $26 million in the first quarter and $133 million in fiscal 2024 from a reduction in depreciation expense based on equipment balances as of January 29, 2023. The favorable impact will be primarily in operating expense, and to a lesser extent in cost of goods sold. [1] https://www.sec.gov/Archives/edgar/data/1045810/000104581023000014/q4fy23cfocommentary.htm https://www.sec.gov/Archives/edgar/data/1045810/000104581023...
- tw04 3y ago>Is this an accounting trick to look profitable or is it normal and reasonable? It seems normal and reasonable to me with their change in direction to making chips for others. Previously Intel (for the most part) needed to rapidly depreciate hardware and move to the next process node to stay competitive. Now they can continue running a process node far beyond what they would have historically to create a cheaper chip-line for third parties.
- brokencode 3y agoI think Intel’s return to success is pretty much inevitable at this point. Just look at how much money they are getting in subsidies from countries like the US and Germany. This is coming from a strong geopolitical imperative to bring advanced semiconductor manufacturing back to the West.
- thunkshift1 3y agoAll semi manufacturers are getting subsidies.. tsmc and samsung have contributions measured in percentage of gdp of the respective countries. Its hard to believe they are not getting any
- jrockway 3y agoFinally the government is doing something good; paying chip manufacturers so I can get paid a million dollars a year to use O(n^2) algorithms everywhere!
- brokencode 3y agoSure, I’m not saying that they won’t be successful too. But Intel is the only Western company capable of manufacturing the most advanced semiconductors right now, and you better believe that makes them too big to fail.
- GartzenDeHaes 3y ago> This is coming from a strong geopolitical imperative to bring advanced semiconductor manufacturing back to the West. But didn't they also offshore their CPU design teams?
- brokencode 3y agoNo? Please cite a source for this.
- __init 3y agoNo; in fact, we're doing more of our core development in the US than at some previous points in our history. (I work at Intel, but this is just my personal observation.)
- gumby 3y ago> Investors want to see gross margins expand even as the company invests heavily in manufacturing capability. Intel should tell such investors to fuck off and let those who believe in intel reap the rewards. I’m not bullish on Intel myself though I hope they do get their act together.
- thesh4d0w 3y agoCEO is being thrify enough that he's wearing vmware swag
- jbirer 3y agoI refuse to buy anything Intel until they reach 7nm.