Intel Beats Earnings Estimates, Confirms $1B Deal With Apple

Shares of Intel Corporation INTC rose after the close Thursday after the chipmaker beat analysts' estimates on earnings and sales in the second quarter, and upped sales and earnings guidance.

Earnings

Intel reported quarterly EPS of $1.06, smashing the Street estimate of 89 cents. The figure represented a nearly 2% increase over earnings of $1.04 per share from the same period last year.

Quarterly sales came in at $16.5 billion, also topping the Street, which had expected revenue of $15.67 billion. The revenue figure was down 2.72% from the $16.962 billion figure turned in in the same period last year.

Guidance

Intel raised its fiscal 2019 sales guidance from $69 billion to $69 billion to $70 billion and its EPS guidance for the third quarter to $1.24, while upping EPS estimates for the full fiscal year from $4.35 to $4.40.

“Second quarter results exceeded our expectations on both revenue and earnings, as the growth of data and compute-intensive applications are driving customer demand for higher performance products in both our PCcentric and data-centric businesses,” said Bob Swan, Intel CEO. “Based on our outperformance in the quarter, we’re raising our full-year guidance.”

Apple

Intel also confirmed it signed an agreement for Apple Inc. AAPL to acquire the majority of Intel's smartphone modem business. The $1 billion deal is expected to close in the fourth quarter of 2019.

"This agreement enables us to focus on developing technology for the 5G network while retaining critical intellectual property and modem technology that our team has created," Swan said.

Intel's stock was trading up 5.8% in the after-hours session to $55.20.

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