Intel (INTC) fell Friday morning after the company announced that it failed to meet fourth-quarter expectations.
Revenues improved more than 1% to $13.8 billion to slightly edge Wall Street expectations, and earnings improved from 48 cents to 51 cents, but just fell shy of EPS estimates for 52 cents. As a result, INTC stock was off smartly at the market’s open, and were down more than 3% as of this writing.
“We had a solid fourth quarter with signs of stabilization in the PC segment and financial growth from a year ago,” said Intel CEO Brian Krzanich. “We’ve built a strong foundation for our business by bringing innovation to the market more quickly across a wide range of computing platforms. For example, at CES, we demonstrated multiple devices that weren’t on our roadmap six months ago.”
PC sales were flat, though there was some hope in Intel’s other branches, such as 8% improvements in data center revenues.
“Microsoft’s plan to stop supporting its Windows XP operating system in April had spurred hopes that some corporations would replace employees’ PCs. But Intel’s chief financial officer, Stacy J. Smith, said that had only a minor impact on the quarter.
PC sales are losing ground to tablets and smartphones, a market that Intel has been slow to enter, but some analysts say they believe the industry’s decline is slowing, potentially giving Intel breathing room as it struggles to develop better processors for mobile devices.”
Intel has been criticized as being slow to adapt its processors for smartphones and tablets, and in that lag the markets are now dominated by the likes of Qualcomm (QCOM) and Samsung (SSNLF).
However, new computing devices such as PCs with detachable screens may help the PC business as potential growth drivers.
The company forecasts revenue of $12.8 billion for Q1 2014, which ends in March. INTC stock analysts expect $12.79 billion on average.
