(AOF) – Intel is expected to rise sharply on Wall Street thanks to profits and prospects much better than expected. In the third quarter, the world’s number one semiconductor company saw its group share of net profit fall 70% to $297 million, or 7 cents per share. Adjusted earnings per share came to 41 cents, a level well above the consensus of 21 cents. Revenue fell 8% to $14.2 billion, compared with a consensus of $13.5 billion.
In detail, the server chip division (which is the most profitable) recorded a 10% decline in sales to $3.8 billion. The market was targeting $3.94 billion. Revenues from PC chips fell 3% to $7.9 billion. They compare with Wall Street expectations of $7.4 billion.
These results combine with a more optimistic outlook than expected for the current quarter.
The Santa Clara (California) firm is targeting adjusted profit per share of 44 cents and revenues of between $14.5 billion and $15.6 billion in the third quarter. The consensus stands at 31 cents and $14.4 billion, respectively.
In the wake of this publication, HSBC raised its recommendation to Hold and its price target from $27 to $33. “While we remain concerned about the overall recovery of the data center market, we raise Intel to “Hold” as we expect significant earnings guidance revisions due to better execution and improving outlook for PCs personal, which will lead to a revaluation of the company”, explains the broker.
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Growing market and price tensions
According to SIA, global chip sales stood at $151.7 billion in the first quarter of 2022, an increase of 23% year-on-year. Sales increased in all major regional markets and for all product categories. As global uncertainties, including the war in Ukraine and the health crisis, weigh on supply chains, demand for semiconductors continues to significantly exceed supply. Manufacturers Samsung and TSMC have announced that they will raise their prices, in a context where players in the sector have good room for maneuver and benefit from reinforced negotiating power. However, wage increases and component prices could weigh on future performance.
Sector sheet – Electronics
Innovations are developing in connected health
At the last CES, innovations in health made significant progress. Thanks to the operation of Artificial Intelligence, numerous objects measuring each person’s constants and communicating in all rooms have been disclosed. Sensors can analyze urine, monitor nutrient or hormone levels. Other objects can measure blood pressure, heart rate and other indicators by analyzing the face from a selfie. Products in the prevention niche are very promising, as are certain start-ups, such as the French company Withings. After its Body Scan, a connected health station for the home, the company is preparing to market the first home urine analysis laboratory. It thus faces American giants like Apple in the prevention market.