Intel Corporation Q4 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Intel delivered Q4 revenue of $15.4 billion, up 9% sequentially and 10% year-over-year, outperforming guidance.
  • Gross margin reached 48.8%, exceeding guidance by 230 basis points due to favorable product mix, improved unit costs, and better ASPs.
  • EPS was $0.54, beating guidance by $0.10.
  • Operating cash flow was $4.6 billion; adjusted free cash flow was negative $1.3 billion.
  • Intel achieved its goal of $3 billion in 2023 cost savings.

Full-Year 2023 Context

  • Intel beat revenue, gross margin, operating margin, and EPS guidance every quarter of 2023.
  • Achieved nearly $2 billion reduction in net inventory and improved DSO/DPO metrics.
  • Significant progress on IDM 2.0: reestablished execution discipline in product and process roadmaps.

Business Unit Performance (Q4 2023)

Client Computing (CCG)
  • Revenue: $8.8 billion, up 12% sequentially and 33% year-over-year.
  • Operating profit: $2.9 billion, up $800 million sequentially and $2.4 billion year-over-year.
  • Drivers: Strong gaming and commercial demand, normalized inventory, record notebook shipments.
  • PC TAM for 2024 expected to grow low single digits vs 2023 (270 million units).

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Operator: Thank you for standing by, and welcome to Intel Corporation's Fourth Quarter 2023 Earnings Conference Call. [Operator Instructions] As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Mr. John Pitzer, Corporate Vice President of Investor Relations. Please go ahead. John Pitzer: Thank you, Jonathan. By now, you should have received a copy of the Q4 earnings release and earnings presentation, both of which are available on our Investor Relations website, intc.com. For those joining us online today, the earnings presentation is also available in our webcast window. I am joined today by our CEO, Pat Gelsinger; and our CFO, David Zinsner. In a moment, we'll hear brief comments from both followed by a Q&A session. Before we begin, please note that today's discussion does contain forward-looking statements based on the environment as we currently see it, and as such, are subject to various risks and uncertainties. It also contains references to non-GAAP financial measures that we believe provide useful information to our investors. Our earnings release, most recent annual report on Form 10-K and other filings with the SEC provide more information on specific risk factors that could cause actual results to differ materially from our expectations. They also provide additional information on non-GAAP financial measures, including reconciliations where appropriate to our corresponding GAAP financial measures. With that

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