Intel Beats Revs, Misses EPS, Guides Flat - Analyst Blog

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After the bell Thursday, Intel Corp. ( INTC ) reported its 4th quarter and fiscal 2013 earnings. The giant chipmaker missed the Zacks Consensus Estimate for earnings per share (EPS) by a penny (51 cents) but produced sales about $100K higher than expectations ($13.8 billion) for the quarter.

We've gotten used to these types of reports from Intel over the past several quarters; analysts rarely revise their earnings estimates for the company, and whether Intel beats or misses, the surprise is typically in the single-digits percentage-wise.

Why INTC stock is falling in the after-market, however -- aside from traders climbing down a bit from the 52-week highs set for the shares on Wednesday -- may have more to do with fiscal 2014 guidance, which is "approximately flat" with the $52.7 billion the company brought in for fiscal 2013. Why this carries extra weight is because Intel investors -- and that of its contemporaries like IBM ( IBM ), Oracle ( ORCL ) and Cisco ( CSCO ), as well -- are still awaiting increased enterprise spending, which has been lackluster of late. Apparently, as of now Intel doesn't see this picking up materially over the next 12 months, either.

In addition, the long, slow migration from PC desktop chips to mobile units is another of Intel's big challenges. While all the big chip-makers have been losing market share to those companies more laser-focused on smartphones and tablets, Intel's early reporting slot for earnings season helps telegraph a bit of what we may expect to see from other Big Tech firms like Microsoft ( MSFT ) in the weeks ahead.

What Intel's earnings report indicates is that, on both the cyclical corporate spending narrative and the secular shift out of desktop equipment, conditions remain in "slog-through" mode. Perhaps they're practicing the art of low expectations going forward, but finishing off the previous year's final quarter with a minor negative earnings surprise doesn't really show much of a silver lining. Let's see what the other Big Tech firms have to offer next.



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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: CSCO , EPS , IBM , INTC , MSFT

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