Intel Corporation Case Study 2013

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Intel Corporation
Intel Corp. reported its fourth quarter and full year 2015 results on 14th Jan. It reported a Y-o-Y increase of 1 % in quarterly revenue to $ 14.9 billion. The operating income was $ 4.3 billion, net income was $ 3.6 billion and the EPS was flat at $ 0.74. For the full year 2015, Intel reported a 1 % decrease in revenue to $ 55.4 billion while its operating income was $ 14.0 billion, net income was $ 11.4 billion and the EPS was up 1 % to $ 2.33.
The company’s gross margin was down 1.1 percentage points both for the fourth quarter as well as the year. Net income for the quarter was down from $ 3.7 billion to $ 3.6 billion and down from $ 11.7 billion to $ 11.4 billion for the year. The company spent 4 % more on R&D and marketing …show more content…

For the year, an all-time record growth in the retail transportation and video segments boosted the group revenue by 7 % to $ 2.3 billion.
Software and services operating segments had revenue of $ 543 million, down 2 % sequentially and down 3 % year-over-year. Non-Volatile Memory Solution Group revenue was flat sequentially and up 10 % year-over-year.
Intel Security Group was flat on a GAAP basis and up 6 % on a constant currency basis. Due to the shift of focus on endpoint technology, the group drove higher material efficiencies and achieved a 44 % improvement in operating income.
The CEO, Brian Krzanich, accepted that there was a significant decline in PC demand through the year. However, he sounded assured that Intel’s results for the fourth quarter were consistent with expectations, marking a strong finish to the year. He said, “Taken as a whole, 2015 demonstrated the benefits of our strategy ….. That strategy is also resulting in the evolution of our business model to focus on three keys areas of growth, the Data Centre, the Internet of Things and Memory. Our results reflect that evolution.” …show more content…

This business provides a foundation of IP and a source of cash flows. The company introduced a revolutionary new class of memory call 3D XPoint, the industry's first new memory technology in more than two decades. The NAND solutions group grew more than 20 % to another all-time record of $ 2.6 billion. Later this year, the company will start producing the upgraded Dalian, China fab and will manufacture both 3D NAND and 3D XPoint versions.
Outlook:
The company provides a soft outlook for the first quarter as a sign of caution on the level of economic growth, particularly in China. The mid-point of the revenue range is expected to be $ 14.1 billion with a gross margin of around 62 % including the effect of an extra work week and the recently completed acquisition of Altera Corporation ("Altera"), a leading provider of field-programmable gate array (FPGA) technology. For the full year, the revenue growth is expected to be in the mid-to-high single digits relative to 2015 with a gross margin of 63 %.

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