Intel Profit Climbs 39%

(RTTNews) - Intel Corp. (INTC) said Thursday after the markets closed that its fourth quarter profit rose 39% from last year, helped by higher revenue, improved margins and a lower effective tax rate.

The company's quarterly earnings per share also came in above analysts' expectations as did its quarterly revenue. However, the Santa Clara, California-based company gave a slightly downbeat revenue outlook for the current quarter.

"The fourth quarter was a strong finish to a record year," said Intel CEO Brian Krzanich. "We met or exceeded several important goals: reinvigorated the PC business, grew the Data Center business, established a footprint in tablets, and drove growth and innovation in new areas. There is more to do in 2015. We'll improve our profitability in mobile, and keep Intel focused on the next wave of computing. "

Intel shares are currently losing 2.04% in after hours trading after closing the day's regular trading session at $36.19, down 16 cents. The shares trade in a 52-week range of $23.50 to $37.90.

The world's biggest chipmaker reported net income for the fourth quarter of $3.7 billion or $0.74 per share, compared to $2.6 billion or $0.51 per share for the year-ago quarter.

On average, 39 analysts polled by Thomson Reuters expected the company to earn $0.66 per share for the fourth quarter.

Gross margin for the quarter improved to 65.4% from 62.0% a year earlier, mainly due to lower factory start-up costs, lower platform unit costs, higher platform average selling prices, and higher platform volumes.

Revenue for the fourth quarter rose 6% to $14.72 billion from $13.83 billion in the same quarter last year. Thirty-nine analysts had a consensus revenue estimate of $14.70 billion for the fourth quarter.

PC Client Group revenue for the fourth quarter increased 3% year-over-year to $8.9 billion. This group caters to desktops, notebooks, wireless and wired connectivity products as well as home gateway and set-top boxes.

Intel is the world's largest supplier of microprocessors, the brains of personal computers, with roughly 80% of the global market share.

Earlier this week, market research firm Gartner, Inc. (IT) said that worldwide PC shipments rose 1% year-over-year to 83.7 million units in the fourth quarter of 2014.

Data Center Group revenue for the quarter rose 25% year-over-year to $4.1 billion. This group caters to the server and storage markets.

Internet of Things Group revenue for the fourth quarter surged 10% from a year earlier to $591 million, while Mobile and Communications Group negative revenue of $6 million, consistent with expectations.

Software and services revenue for the fourth quarter fell 6% from last year to $557 million.

Looking forward, the company forecasts first quarter revenue of $13.7 billion, plus or minus $500 million. Analysts currently expect the company to post revenue of $13.77 billion for the first quarter.

Gross margin for the first quarter is expected to be 60%, plus or minus a couple of percentage points.

For the full year 2015, the company continues to forecast revenue growth in the mid-single digit percentage points and gross margin of 62%, plus or minus a couple of percentage points. Analysts currently expect the company to post revenue growth of 4.20% for the full year 2015.