Intel Reports Fourth-Quarter and Full-Year 2024 Financial Results

Business Wire 30-Jan-2025 4:01 PM

News Summary

• Fourth-quarter revenue was $14.3 billion, down 7% year-over-year (YoY). Full-year revenue was $53.1 billion, down 2% YoY.

• Fourth-quarter earnings per share (EPS) attributable to Intel was $(0.03); non-GAAP EPS attributable to Intel was $0.13. Full-year EPS attributable to Intel was $(4.38); non-GAAP EPS attributable to Intel was $(0.13).

• Forecasting first-quarter 2025 revenue of $11.7 billion to $12.7 billion; expecting first-quarter EPS attributable to Intel of $(0.27) and non-GAAP EPS attributable to Intel of $0.00.

Intel Corporation today reported fourth-quarter and full-year 2024 financial results.

"The fourth quarter was a positive step forward as we delivered revenue, gross margin and EPS above our guidance," said Michelle Johnston Holthaus, interim co-CEO of Intel and CEO of Intel Products. "Our renewed focus on strengthening and simplifying our product portfolio, combined with continued progress on our process roadmap, is positioning us to better serve the needs of our customers. Dave and I are taking actions to enhance our competitive position and create shareholder value."

"The cost reduction plan we announced last year to improve the trajectory of the company is having an impact," said David Zinsner, interim co-CEO and chief financial officer of Intel. "We are fostering a culture of efficiency across the business while driving toward greater returns on our invested capital and improved profitability. Our Q1 outlook reflects seasonal weakness magnified by macro uncertainties, further inventory digestion and competitive dynamics. We will remain highly focused on execution to build on our progress and unlock value."

Q4 2024 Financial Results

In the fourth quarter, the company generated $3.2 billion in cash from operations.

Full reconciliations between GAAP and non-GAAP measures are provided below.

Full-Year 2024 Financial Results

For the full year, the company generated $8.3 billion in cash from operations and paid dividends of $1.6 billion.

Business Unit Summary

In October 2022, Intel announced an internal foundry operating model, which took effect in the first quarter of 2024 and created a foundry relationship between its Intel Products business (collectively CCG, DCAI and NEX) and its Intel Foundry business (including Foundry Technology Development, Foundry Manufacturing and Supply Chain, and Foundry Services, formerly IFS). The foundry operating model is designed to reshape operational dynamics and drive greater transparency, accountability, and focus on costs and efficiency. In furtherance of Intel's internal foundry operating model, Intel announced in the third quarter of 2024 its intent to establish Intel Foundry as an independent subsidiary. The company also previously announced its intent to operate Altera^® as a standalone business. Altera was previously included in DCAI's segment results and, beginning in the first quarter of 2024, is included in "all other." As a result of these changes, the company modified its segment reporting in the first quarter of 2024 to align to this new operating model. All prior-period segment data has been retrospectively adjusted to reflect the way the company internally receives information and manages and monitors its operating segment performance starting in fiscal year 2024. There are no changes to Intel's consolidated financial statements for any prior periods.

Intel Products Highlights

• CCG: Intel continues to lead the AI PC category. The company is on track to ship more than 100 million AI PCs by the end of 2025, and is working with more than 200 ISVs across more than 400 features to optimize their software on Intel silicon. At CES, Intel introduced the Intel® Core™ Ultra 200V series mobile processors with Intel vPro®, empowering businesses with AI-driven productivity and enhanced IT management. The company also unveiled the Intel® Core™ Ultra 200H and HX series mobile processors, delivering industry-leading performance, efficiency and platform capabilities, alongside a landmark reduction in power usage. Intel expects to further strengthen its client roadmap with the launch of Panther Lake, its lead product on the Intel 18A process technology, in the second half of 2025.

• DCAI: Intel collaborated with Dell Technologies on the Dell PowerEdge XE7740 server, which uses dual Intel® Xeon® 6 with Performance-cores and up to eight double-wide accelerators, including Intel® Gaudi® 3 AI accelerators. Intel also showcased its MRDIMMs memory technology, the fastest memory system ever created, in Intel® Xeon® 6 data center processors, achieving a significant increase in bandwidth that would normally take multiple generations to reach.

• NEX: At CES, Intel launched a new line of Intel® Core™ Ultra processors for edge computing, prioritizing scalability and performance across various AI applications.

• Intel and AMD are seeing strong engagement from the x86 Ecosystem Advisory Group. Following the group's inaugural meeting this month at Intel's headquarters, Intel and AMD initiated work to drive key architectural features that enable compatibility across platforms, simplify software development and support needs of developers.

Intel Foundry Highlights

• In December, Intel Foundry achieved full tape-out of an Intel 16-based design for an external customer, with plans for volume manufacturing later this year at Intel Ireland, the company's lead European wafer fabrication center.

• Process tool installation is underway in Fab 52 in Arizona in support of ramping Intel 18A production this year.

• Intel signed a definitive agreement with the U.S. Department of Commerce awarding the company up to $7.86 billion in direct funding under the U.S. CHIPS and Science Act. Intel achieved initial milestones, receiving $1.1 billion in the fourth quarter of 2024 and $1.1 billion in January 2025. The CHIPs agreement supports Intel's essential role in advancing domestic leading-edge semiconductor R&D and manufacturing that are critical to economic and national security.

• At IEDM 2024, Intel Foundry's Technology Research team demonstrated industry-first advancements in transistor and advanced packaging technologies that help meet future demands for AI.

Intel Foundry Direct Connect Event

On April 29, 2025, Intel Foundry will host its annual flagship event, Intel Foundry Direct Connect, in San Jose, California. The event will feature talks from Intel leaders, customers, industry technologists and ecosystem partners as they share details of Intel Foundry's strategy, process technology, and advanced packaging and test capabilities. The event will also include an ecosystem exhibition and networking opportunities. For information about the event, please visit https://www.intel.com/content/www/us/en/events/foundry-direct-connect.html.

Business Outlook

Intel's guidance for the first quarter of 2025 includes both GAAP and non-GAAP estimates as follows:

Reconciliations between GAAP and non-GAAP financial measures are included below. Actual results may differ materially from Intel's business outlook as a result of, among other things, the factors described under "Forward-Looking Statements" below. The gross margin and EPS outlooks are based on the mid-point of the revenue range.

Earnings Webcast

Intel will hold a public webcast at 2 p.m. PST today to discuss the results for its fourth quarter of 2024. The live public webcast can be accessed on Intel's Investor Relations website at www.intc.com. The corresponding earnings presentation and webcast replay will also be available on the site.

Forward-Looking Statements

This release contains forward-looking statements that involve a number of risks and uncertainties. Words such as "accelerate", "achieve", "aim", "ambitions", "anticipate", "believe", "committed", "continue", "could", "designed", "estimate", "expect", "forecast", "future", "goals", "grow", "guidance", "intend", "likely", "may", "might", "milestones", "next generation", "objective", "on track", "opportunity", "outlook", "pending", "plan", "position", "possible", "potential", "predict", "progress", "ramp", "roadmap", "seek", "should", "strive", "targets", "to be", "upcoming", "will", "would", and variations of such words and similar expressions are intended to identify such forward-looking statements, which may include statements regarding:

• our business plans, strategy and leadership and anticipated benefits therefrom, including with respect to our foundry strategy, Smart Capital strategy, partnerships with Apollo and Brookfield, AI strategy, organizational structure, and management, including our search for a new CEO;

• projections of our future financial performance, including future revenue, gross margins, capital expenditures, profitability, and cash flows;

• future cash requirements, the availability, uses, sufficiency, and cost of capital resources, and sources of funding, including for future capital and R&D investments and for returns to stockholders, and credit ratings expectations;

• future products, services, and technologies, and the expected goals, timeline, ramps, progress, availability, production, regulation, and benefits of such products, services, and technologies, including future process nodes and packaging technology, product roadmaps, schedules, future product architectures, expectations regarding process performance, per-watt parity, and metrics, and expectations regarding product and process competitiveness;

• projected manufacturing capacities, volumes, costs, and yield trends;

• internal and external manufacturing plans, including manufacturing expansion projects and the financing therefor;

• supply expectations, including regarding constraints, limitations, pricing, and industry shortages;

• plans and goals related to Intel's foundry business, including with respect to anticipated governance, customers, future manufacturing capacity, and service, technology, and IP offerings;

• expected timing and impact of acquisitions, divestitures, and other significant transactions, including the sale of our NAND memory business;

• expected timing, completion and impacts of restructuring activities and cost-saving or efficiency initiatives;

• future social and environmental performance goals, measures, strategies, and results;

• our anticipated growth, future market share, and trends in our businesses and operations;

• projected growth and trends in markets relevant to our businesses;

• expectations regarding CHIPS Act funding and other governmental awards or potential future governmental incentives;

• future technology trends and developments, such as AI;

• future macro environmental and economic conditions;

• geopolitical tensions and conflicts and their potential impact on our business;

• tax- and accounting-related expectations;

• expectations regarding our relationships with certain sanctioned parties; and

• other characterizations of future events or circumstances.

Such statements involve many risks and uncertainties that could cause our actual results to differ materially from those expressed or implied, including those associated with:

• the high level of competition and rapid technological change in our industry;

• the significant long-term and inherently risky investments we are making in R&D and manufacturing facilities that may not realize a favorable return;

• the complexities and uncertainties in developing and implementing new semiconductor products and manufacturing process technologies;

• implementing new business strategies and investing in new businesses and technologies;

• our ability to time and scale our capital investments appropriately and successfully secure favorable alternative financing arrangements and government grants;

• changes in demand for our products and the margins we are able to make on them;

• macroeconomic conditions and geopolitical tensions and conflicts, including geopolitical and trade tensions between the US and China, tensions and conflict affecting Israel and the Middle East, rising tensions between mainland China and Taiwan, and the impacts of Russia's war on Ukraine;

• the evolving market for products with AI capabilities;

• our complex global supply chain, including from disruptions, delays, trade tensions and conflicts, or shortages;

• product defects, errata, and other product issues, particularly as we develop next-generation products and implement next-generation manufacturing process technologies;

• potential security vulnerabilities in our products;

• increasing and evolving cybersecurity threats and privacy risks;

• IP risks, including related litigation and regulatory proceedings;

• the ongoing need to attract, retain, and motivate key talent, including engineering and management talent, as we have undertaken multiple significant headcount reductions and had significant management changes in the last few years, including our CEO;

• strategic transactions and investments;

• sales-related risks, including customer concentration and the use of distributors and other third parties;

• our debt obligations and our ability to access sources of capital;

• our having ceased to return capital to stockholders;

• complex and evolving laws and regulations across many jurisdictions;

• fluctuations in currency exchange rates;

• changes in our effective tax rate;

• catastrophic events;

• environmental, health, safety, and product regulations;

• our initiatives and new legal requirements with respect to corporate responsibility matters; and

• other risks and uncertainties described in this release, our 2024 Form 10-K, and our other filings with the SEC.

Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Readers are urged to carefully review and consider the various disclosures made in this release and in other documents we file from time to time with the SEC that disclose risks and uncertainties that may affect our business.

Unless specifically indicated otherwise, the forward-looking statements in this release do not reflect the potential impact of any divestitures, mergers, acquisitions, or other business combinations that have not been completed as of the date of this filing. In addition, the forward-looking statements in this release are based on management's expectations as of the date of this release, unless an earlier date is specified, including expectations based on third-party information and projections that management believes to be reputable. We do not undertake, and expressly disclaim any duty, to update such statements, whether as a result of new information, new developments, or otherwise, except to the extent that disclosure may be required by law.

About Intel

Intel (NASDAQ:INTC) is an industry leader, creating world-changing technology that enables global progress and enriches lives. Inspired by Moore's Law, we continuously work to advance the design and manufacturing of semiconductors to help address our customers' greatest challenges. By embedding intelligence in the cloud, network, edge and every kind of computing device, we unleash the potential of data to transform business and society for the better. To learn more about Intel's innovations, go to newsroom.intel.com and intel.com.

© Intel Corporation. Intel, the Intel logo, and other Intel marks are trademarks of Intel Corporation or its subsidiaries. Other names and brands may be claimed as the property of others.

Intel Corporation Explanation of Non-GAAP Measures

In addition to disclosing financial results in accordance with US GAAP, this document references non-GAAP financial measures below. We believe these non-GAAP financial measures provide investors with useful supplemental information about our operating performance, enable comparison of financial trends and results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating our business and measuring our performance. These non-GAAP financial measures are used in our performance-based RSUs and our cash bonus plans.

Our non-GAAP financial measures reflect adjustments based on one or more of the following items, as well as the related effects to income taxes and net income (loss) attributable to non-controlling interests effects. Income tax effects are calculated using a fixed long-term projected tax rate. For 2024 and 2023, we determined the projected non-GAAP tax rate to be 13%. For 2025, we determined the projected non-GAAP tax rate to be 12%. We project this long-term non-GAAP tax rate on at least an annual basis using a five-year non-GAAP financial projection that excludes the income tax effects of each adjustment. The projected non-GAAP tax rate also considers factors such as our tax structure, our tax positions in various jurisdictions, and key legislation in significant jurisdictions where we operate. This long-term non-GAAP tax rate may be subject to change for a variety of reasons, including the rapidly evolving global tax environment, significant changes in our geographic earnings mix, or changes to our strategy or business operations. Management uses this non-GAAP tax rate in managing internal short- and long-term operating plans and in evaluating our performance; we believe this approach facilitates comparison of our operating results and provides useful evaluation of our current operating performance. Non-GAAP adjustments attributable to non-controlling interests are calculated by adjusting for the minority stockholder portion of non-GAAP adjustments we make for relevant acquisition-related costs, share-based compensation, restructuring and other charges, and income tax effects, as applicable to each majority-owned subsidiary.

Our non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with US GAAP, and the financial results calculated in accordance with US GAAP and reconciliations from these results should be carefully evaluated.

Intel Corporation Supplemental Reconciliations of GAAP Actuals to Non-GAAP Actuals

Set forth below are reconciliations of the non-GAAP financial measure to the most directly comparable US GAAP financial measure. These non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with US GAAP, and the reconciliations from US GAAP to Non-GAAP actuals should be carefully evaluated. Please refer to "Explanation of Non-GAAP Measures" in this document for a detailed explanation of the adjustments made to the comparable US GAAP measures, the ways management uses the non-GAAP measures, and the reasons why management believes the non-GAAP measures provide useful information for investors.

Intel Corporation Supplemental Reconciliations of GAAP Outlook to Non-GAAP Outlook

Set forth below are reconciliations of the non-GAAP financial measure to the most directly comparable US GAAP financial measure. These non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with US GAAP, and the financial outlook prepared in accordance with US GAAP and the reconciliations from this Business Outlook should be carefully evaluated. Please refer to "Explanation of Non-GAAP Measures" in this document for a detailed explanation of the adjustments made to the comparable US GAAP measures, the ways management uses the non-GAAP measures, and the reasons why management believes the non-GAAP measures provide useful information for investors.

Intel Corporation Supplemental Reconciliations of Other GAAP to Non-GAAP Forward-Looking Estimates

Set forth below are reconciliations of the non-GAAP financial measure to the most directly comparable US GAAP financial measure. These non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with US GAAP, and the reconciliations should be carefully evaluated. Please refer to "Explanation of Non-GAAP Measures" in this document for a detailed explanation of the adjustments made to the comparable US GAAP measures, the ways management uses the non-GAAP measures, and the reasons why management believes the non-GAAP measures provide useful information for investors.

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Kylie Altman Investor Relations 1-916-356-0320 kylie.altman@intel.com

Sophie Won Metzger Media Relations 1-408-653-0475 sophie.won@intel.com