Intel returns to profit after a challenging eighteen-month period.
Intel has posted a profit for the first time in eighteen months. The chip manufacturer reported strong growth in its PC chips and is benefiting from lower costs due to layoffs and savings. The workforce has already been reduced by 29% since a year ago.
End of Losses
According to a report, Intel generated a revenue of $15.65 billion in the third quarter, well above Wall Street’s expectation of $13.14 billion. The net result amounts to a $4.1 billion profit; last year, the loss was $16.6 billion.
According to CFO David Zinser, demand for PC chips is rising higher than anticipated as companies are now fully migrating to Windows 11. Official support for Windows 10 has ended. The company’s stock price has already risen by 85 percent since August this year. According to SiliconANGLE, this is partly because the US government is taking a 10 percent stake in Intel, and because competitor Nvidia is investing $5 billion in x86 CPUs for data centers.
Data Center Chips
As AI is increasingly used, demand for energy-efficient CPUs for inference is rising. Hyperscalers need to upgrade their old server systems to focus more on AI. Intel specializes in CPUs but has not yet succeeded in competing with Nvidia in the AI domain.
For the fourth quarter, Intel expected revenue between $12.8 billion and $13.8 billion.