Intel (INTC) Q4 2021 Earnings – A Solid Result That Again Failed To Create a Buzz

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Intel (NASDAQ:INTC) has now announced its earnings for the fourth quarter of 2021, beating consensus expectations regarding its top-line and bottom-line metrics.

Intel (NASDAQ: INTC) Earnings Release for the Fourth Quarter of 2021

For the three months that ended on the 31st of December 2021, Intel reported $19.5 billion in non-GAAP revenue. The number exceeded consensus expectations by 6 percent.

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(All figures are in billions of dollars)

Here is the performance of Intel's business segments in Q4 2021:

Readers should note that analysts expected the Client Computing Group (CCG) to post sales of $9.6 billion and the Data-Center Group (DCG) to generate $6.7 billion in revenue during the quarter. During Q4 2021, DCG recorded an all-time high revenue, while NSG ended up as the biggest disappointment.

The following excerpt from the company's earnings release provides supplemental platform revenue information:

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Finally, Intel earned $1.09 in EPS (non-GAAP), beating consensus expectations by 19.8 percent.

(All figures are in dollars)

Here is Intel's guidance for the first quarter of 2022:

As far as Intel's product line is concerned, the company noted in its press release:

  • Announced plans to take Mobileye public in the United States in mid-2022 via an initial public offering of newly issued Mobileye stock.
  • Completed the first closing of the sale of our NAND memory business to SK Hynix, Inc.
  • Announced initial investment of more than $20 billion to build two new leading-edge chip factories in Ohio, where we are establishing the first advanced semiconductor campus in the "Silicon Heartland" of the Midwest. This will be Intel's first new manufacturing site location in 40 years.
  • Launched the 12th Gen Intel® Core™ processor family, including the all-new 12th Gen Intel Core H-series mobile processors led by the Intel Core i9-12900HK, the fastest mobile processor ever created.1 The 12th Gen Intel Core family will include 60 processors and more than 500 designs.
  • Unveiled key packaging, transistor, and quantum physics breakthroughs fundamental to advancing and accelerating computing well into the next decade and outlined its path toward more than 10x interconnect density improvement in packaging with hybrid bonding and 30% to 50% area improvement in transistor scaling.
  • Began shipping Intel® Arc™ discrete graphics products (code-named "Alchemist") to OEM/ODM customers, with more than 50 design wins.

Investors have reacted negatively to Intel's latest earnings release, with the stock registering a loss of over 2 percent in after-hours trading.

Earnings Context

As we've noted previously, Intel is investing at least $20 billion to build a hub in Ohio that might eventually house as many as eight fabs. The company plans to build at least two fabs at its Ohio hub on a priority basis, with production expected to commence in 2025. Intel is also investing another $20 billion in Ocotillo, Arizona, in order to add two new facilities that will serve both Intel's customers and future foundry partners.

In order to fund these expensive projects, Intel is divesting non-essential businesses. One such move is the sale of Intel's memory unit to the South Korean firm SK Hynix, which completed regulatory approval toward the end of 2021. These efforts are part of a broader push by the chip manufacturing industry to set up plants in the United States.