Intel reported Q2 revenue of $12.9 billion, down 15% year over year (YoY).
The results beat expectations on gross margin and EPS. Intel also raised guidance for the remaining part of the year. GAAP gross margin was 39.1%
“Our Q2 results exceeded the high end of our guidance as we continue to execute on our strategic priorities, including building momentum with our foundry business and delivering on our product and process roadmaps,” said Pat Gelsinger, Intel CEO. “We are also well-positioned to capitalize on the significant growth across the AI continuum by championing an open ecosystem and silicon solutions that optimize performance, cost and security to democratize AI from cloud to enterprise, edge and client.”
David Zinsner, Intel CFO, said, “Strong execution, including progress towards our $3 billion in cost savings in 2023, contributed to the upside in the quarter. We remain focused on operational efficiencies and our Smart Capital strategy to support sustainable growth and financial discipline as we improve our margins and cash generation and drive shareholder value.”
Some highlights
- Data Center and AI (DCAI) group revenues were lower on higher unit costs driven by factory utilization and product mix
- Network and Edge Group (NEX) revenue s were lower on edge and telco demand softness and elevated network inventories
- Intel remains on track to meet its goal of achieving five nodes in four years.
- IFS announced that Boeing and Northrop Grumman have committed to joining the U.S. Department of Defense’s RAMP-C program, led by Intel. The program is intended to assure domestic access to next-generation semiconductors by establishing and demonstrating a U.S.-based foundry ecosystem to develop and fabricate chips on Intel 18A.
- DCAI announced the general availability of cloud instances of its 4th Gen Intel Xeon® Scalable processors by Google Cloud.
- In CCG, Intel continued to see strong demand for its 13th Gen Intel Core™ processor family, with more than 300 designs expected from OEM partners this year. It also announced a collaboration with Microsoft to drive the development of AI on personal computing, and previewed AI-enabled capabilities of Intel’s upcoming Meteor Lake client PC processors at Microsoft’s Build 2023 conference. In addition, Intel introduced the Intel® Arc™ Pro A60 and Pro A60M as new members of the Intel Arc Pro A-series professional range of graphics processing units (GPUs).
- For NEX, Intel, Ericsson and HPE successfully demonstrated the industry’s first vRAN solution running on the 4th Gen Intel Xeon Scalable processor with Intel vRAN Boost.
- Mobileye continued to generate strong profitability in the second quarter and demonstrated traction with its advanced product portfolio by announcing a SuperVision eyes-on, hands-off design win with Porsche and a mobility-as-a-service collaboration with Volkswagen Group that will soon begin testing.
- The company has 122,200 employees at the end of the quarter compared to 128,200 a year earlier.