The Intel brand is displayed on an indication in entrance of Intel headquarters on July 16, 2025 in Santa Clara, California.
Justin Sullivan | Getty Photos
Intel reported second-quarter outcomes on Thursday that beat Wall Avenue expectations on income, as the corporate’s new CEO Lip-Bu Tan introduced important cuts in chip manufacturing facility development. The inventory fell about 5% in prolonged buying and selling.
Here is how the chipmaker did versus LSEG consensus estimates:
- Earnings per share: Lack of 10 cents per share, adjusted.
- Income: $12.86 billion versus $11.92 billion estimated
Intel stated it expects income for the third-quarter of $13.1 billion on the midpoint of its vary, versus the typical analyst estimate of $12.65 billion. The chipmaker stated that it expects to interrupt even on earnings whereas analysts have been searching for earnings of 4 cents per share.
For the second quarter, Intel reported a web lack of $2.9 billion, or 67 cents per share, in contrast with a $1.61 billion web loss, or 38 cents per share, in the year-earlier interval. Earnings per share weren’t corresponding to analyst estimates attributable to an $800 million impairment cost, “associated to extra instruments with no recognized re-use,” the corporate stated. That resulted in an EPS adjustment of about 20 cents.
The report was Intel’s second since Lip-Bu Tan took over as CEO in March, promising to make the chipmaker’s merchandise aggressive once more, and to scale back paperwork and layers of administration, together with slashing employees in Oregon and California.
In a memo to staff printed on Thursday, Tan stated that the primary few months of his tenure had “not been simple.” He stated that the corporate had “accomplished the bulk” of its deliberate layoffs, amounting to fifteen% of the workforce, and that it plans to finish the yr with 75,000 staff. Intel beforehand stated it was making an attempt to scale back working bills by $17 billion in 2025.
Intel shares are up about 13% this yr as of Thursday’s shut after plummeting 60% in 2024, their worst yr on document.
Tan additionally introduced a number of different spending cuts within the memo, notably within the firm’s pricey foundry division, which makes chips for different firms and remains to be searching for an enormous buyer to anchor the enterprise.
Intel stated its foundry enterprise had an working lack of $3.17 billion on $4.4 billion in income.
Tan stated that Intel had cancelled deliberate fab tasks in Germany and Poland, and can consolidate its testing and meeting operations in Vietnam and Malaysia. He added that the corporate would decelerate the tempo of its development of a cutting-edge chip manufacturing facility in Ohio, relying on market demand and if it might probably safe massive prospects for the ability.
“Over the previous a number of years, the corporate invested an excessive amount of, too quickly – with out sufficient demand,” Tan wrote. “Within the course of, our manufacturing facility footprint grew to become needlessly fragmented and underutilized.”
Tan wrote that the corporate’s forthcoming chip manufacturing course of, referred to as 14A, will probably be constructed out based mostly on confirmed buyer commitments.
“There are not any extra clean checks. Each funding should make financial sense,” Tan wrote.
The corporate’s shopper computing group, which is primarily comprised of gross sales of central processors for PCs, had $7.9 billion in gross sales, down 3% on an annual foundation.
Income within the information heart group, which incorporates some AI chips however is usually central processors for servers, rose 4% to $3.9 billion. Tan wrote in his memo that Intel needs to regain market share in information heart chips, and is searching for a everlasting chief for the enterprise. Longtime rival Superior Micro Gadgets has more and more been profitable server enterprise from cloud prospects.
Tan added he would personally evaluation and approve all chip designs earlier than they’re taped out, which is the ultimate step of the design course of earlier than a brand new chip is manufactured.
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