Intel Corporation (NASDAQ:INTC) reported significant declines in its sales, profit, gross margin, and outlook both for its fourth quarter and full-year 2022 after hours on Thursday, sending its shares over 9% lower in extended trading, although the chip giant held its dividend.
The tech giant reported fourth-quarter revenue of $14.0 billion, down 32% year-over-year (YoY) and down 28% YoY on a non-GAAP basis. Full-year revenue was $63.1 billion, down 20%YoY and down 16% YoY on a non-GAAP basis. Its fourth-quarter earnings (loss) per share (EPS) was $(0.16), with non-GAAP EPS at $0.10., while full-year EPS was $1.94 and non-GAAP EPS was $1.84.
The latest earnings report showed the tech giant struggling with many factors outside of its control, including a deeply slumping PC market, and Intel did not give any full-year guidance for 2023, citing economic uncertainty.
Intel did provide guidance for about $11 billion in sales in the first quarter of 2023, which would be a 40% YoY decline, and said gross margin will be 34.1%.
The chipmaker also guided to a 15 cent non-GAAP loss per share for the quarter, a big turnaround from a $1.13 profit per share a year earlier. It would be the company's first loss per share since last summer, which was its first loss in decades.
Management gave several reasons for the tough upcoming quarter, but one clear factor was that its customers simply have too many chips and need to work through inventory, so they won’t be buying many new ones.
“Despite the economic and market headwinds, we continued to make good progress on our strategic transformation in Q4, including advancing our product roadmap and improving our operational structure and processes to drive efficiencies while delivering at the low-end of our guided range,” said Pat Gelsinger, Intel CEO in a statement.
“In 2023, we will continue to navigate the short-term challenges while striving to meet our long-term commitments, including delivering leadership products anchored on open and secure platforms, powered by at-scale manufacturing and supercharged by our incredible team," he added.
Intel has said it wants to cut $3 billion in costs for 2023 and analysts believe it wants to spend around $20 billion in capital expenditures to build out its factories.
The company spent $6 billion on dividends in 2022, but did not, at least, cut its latest planned payout of $0.365 per share.