Intel disappoints Wall Street with full-year earnings
Shares slide 5% as company struggles to fix reliance on PC market
Intel, the world's biggest chipmaker, disappointed Wall Street with its recently released full-year results for 2015, which showed strong profit growth but an overdependence on the struggling PC market.
Given the state of the global PC market, currently at its lowest level since 2008, Wall Street was hoping for a bump in Intel's data centre revenue for 2015. However, revenue for the fourth quarter was $4.3bn, slightly below the Street's forecasts of $4.4bn. Moreover, revenue for Intel's data centre group was up 5% year-on-year - slightly below investors' hopes.
As a result, the vendor saw a 5% drop in its share price, following the release of its financial results.
The company's client computing group, by far its biggest business, saw revenue plunge by 8% to $32.2bn for the full year from 2014. Internet of Things Group revenue was $2.3 billion, up 7% from 2014, while the software and services operating segments saw revenue of $2.2 billion, down 2% from 2014. The Non-Volatile Memory Solution Group's revenue was up 21% from 2014.
Despite Wall Street disappointment, Intel said that its financial performance was in line with expectations, adding that it would further branch out from its traditional business of supplying chips for PCs.
"Our results for the fourth quarter marked a strong finish to the year and were consistent with expectations," said Brian Krzanich, Intel CEO.
"Our 2015 results demonstrate that Intel is evolving and our strategy is working. This year, we'll continue to drive growth by powering the infrastructure for an increasingly smart and connected world."