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By Stephen Nellis
July 22 (Reuters) – Intel Corp on Thursday raised its annual revenue forecast above Wall Street expectations, but chief executive Pat Gelsinger said the chipmaker’s outlook was still “limited by supply” and that it could take the industry two more years to catch up with growing demand for chips.
Coupled with a third-quarter sales forecast that just erased analysts’ estimates, the results pushed stocks down 2.8% in after-hours trading after the results.
Intel, one of the few remaining companies in the processor chip industry to design and manufacture its own chips, has been able to weather supply chain difficulties better than some competitors and is also working to build a business. manufacturing chips for others, called a “foundry” business.
Gelsinger declined to comment on a recent report that Intel was looking to buy GlobalFoundries for $ 30 billion to bolster its foundry efforts, but told Reuters he expects industry consolidation to continue. and that “mergers and acquisitions will remain part of our strategy” to build the company’s foundry. company.
Intel said it now expects adjusted annual revenue of $ 73.5 billion, compared to its previous forecast of $ 72.5 billion and analysts’ expectations of $ 72.80 billion. dollars, according to data from Refinitiv IBES.
Gelsinger said Intel could sell more chips if it could make more chips. Even though the company operates its own factories, it still faces supply constraints from its own suppliers of materials and equipment.
“We are helping them build factories as fast as they can,” Gelsinger told Reuters. “But it will be one of those things that will only take a few years to fully catch up with this explosive demand that we are seeing, and we have better tools to meet it than others.”
Intel is forecasting adjusted third-quarter revenue of around $ 18.2 billion, slightly above estimates of $ 18.09 billion, according to data from Refinitiv.
Revenue from the company’s higher-margin data center business fell 9% to $ 6.5 billion in the second quarter, while revenue from its personal IT business grew 6%, exceeding Refinitiv’s estimates.
On an adjusted basis, the company earned $ 1.28 per share in the second quarter, compared to estimates of $ 1.06, according to data from Refinitiv. (Reporting by Chavi Mehta in Bangalore and Stephen Nellis in San Francisco; editing by Shounak Dasgupta and Diane Craft)
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