Intel Returns To Profitability But Its Turnaround Won't Happen Overnight
Portfolio Pulse from Upwallstreet
Intel Corporation (NASDAQ:INTC) returned to profitability in Q2 2021, posting a net income of $1.5 billion, after its largest ever loss in Q1. Despite a 15% YoY contraction in revenue to $12.9 billion, the results exceeded Refinitiv’s consensus estimate of $12.13 billion. Intel also issued a better-than-expected Q3 guidance. However, the company's turnaround is expected to take time as it tries to catch up to Taiwan Semiconductor Manufacturing Company Limited's (NYSE:TSM) chip-manufacturing capacity by 2026. Intel's CEO acknowledged persistent weakness across all business segments, expected to continue until year-end.
July 28, 2023 | 5:53 pm
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NEGATIVE IMPACT
Intel is trying to catch up to TSM's chip-manufacturing capacity by 2026. However, TSM also experienced a revenue decline in Q2, causing its shares to drop 5%.
Intel's aim to match TSM's capacity by 2026 indicates strong competition. TSM's Q2 revenue decline and subsequent share price drop may create short-term uncertainty.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
NEUTRAL IMPACT
Nvidia Corporation (NASDAQ:NVDA) is mentioned as one of the customers of TSM, the world’s largest contract chip maker.
Nvidia is mentioned as a customer of TSM. However, the news does not provide any specific information that could impact Nvidia's stock in the short term.
CONFIDENCE 70
IMPORTANCE 20
RELEVANCE 20
POSITIVE IMPACT
Intel returned to profitability in Q2, exceeding estimates, and issued a better-than-expected Q3 guidance. However, the company's turnaround is expected to take time.
Intel's return to profitability and better-than-expected Q3 guidance are positive signs for the company. However, the ongoing turnaround and competition with TSM may create uncertainty in the short term.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100