Today, investors were ecstatic with Intel stock (NASDAQ:INTC) latest quarterly financial results, which revealed higher-than-expected top and bottom lines. The IT industry has largely disappointed investors recently, so the company’s excellent news was appreciated.
However, not everything went well for Intel in the quarter, and management said that cost cuts are on the way. However, investors saw the latest quarterly data as a glass half-full, and its share price had risen 11% as of 11:28 a.m. ET.
So, What’s the Deal?
In the third quarter, Intel announced adjusted profits per share of $0.59, down 85% from the previous year but well above analysts’ average forecast of $0.32 per share.
Intel’s overall revenues of $15.3 billion were also above Wall Street’s consensus estimate of $15.2 billion but were 20% lower than the previous quarter.
Investors were excited about the firm outperforming analysts’ projections since tech companies have recently announced weak quarterly results.
However, Intel’s last financial report was not all positive. Management reduced full-year sales expectations from $65 billion to $68 billion to $63 billion to $64 billion.
The business also reduced its full-year adjusted profits outlook to $1.95 per share, down from $2.30 before.
Because of these modifications, Intel’s (NASDAQ:INTC) predictions for the year are now lower than analysts’ expectations of $65.2 billion in revenue and $2.15 per share.
Intel Stock: What Now?
In addition to decreasing its full-year projection, Intel’s management provided a relatively bleak assessment of the current state of the economy, with CEO Pat Gelsinger remarking on the results call that “… we are preparing for economic uncertainty to endure until 2023.”
“It looks that the present adverse market situation will stretch far into 2023, with the prospect for a worldwide recession,” said chief financial officer Dave Zinsner.
Intel expects to cut expenses by $3 billion next year and raise yearly cost cuts to $8 billion to $10 billion by the end of 2025 to help weather the uncertainties.
Zinsner told Barron’s that there would be a “significant number” of layoffs due to the cost-cutting.
While investors were pleased with Intel’s better-than-expected earnings today, they may want to brace themselves for possibly challenging times in the coming quarters.
Featured Image- Pexels @ Andrey Matveev
Author Okoro Chinedu 
