Intel Corporation’s (NASDAQ:INTC) stock gained 4% in pre-market trading after topping earnings estimates in Q3. The company also reignited revenue growth thanks to enhanced growth from the data center business.
Intel Reports Impressive Q3 Results
Revenue grew slightly by 0.14% on an annualized basis in the third quarter. The company reported record revenue of $19.19 billion beating analysts’ projections of $18.05 billion in the process. Intel reported earnings per share of $1.42 beating analysts’ prediction of $1.24.
According to Intel CEO Robert Swan, the company has made significant progress in its strategic priorities. He said that the company posted record revenues overall as well as from the data-centric segment. Swan added that the focus of the company is to enhance execution, accelerate growth as well as invest in attractive returns.
Intel has two main business segments that are the Client Computing Group and the Data Centre Group. The Client Computing Group sells processors for PCs and laptops as well as other two-in-one gadgets. The segment has been the company’s main revenue source for years.
In the quarter it generated $9.71 billion which was a 5% drop from last year buts still beat the average estimate of $9.59. The company has cited lower platform volume as the reason for the drop in the segment.
Datacenter Segment Posted Record Revenue
The Data Centre Group which focuses on server chips has been making significant gains. The segment reported record revenue of around 6.4 billion which is a 28% increase from the previous quarter.
The exceptional performance was a result of strong uptake of the company’s second-generation Xeon Scalable products. The company has so far delivered around 23 million units to clients since the launch of the first Xeon Scalable processor. The cloud part of the segment showed significant signs of a return to growth.
However, the company is equally facing issues affecting the shipment of 14-nanometer chips. There is also growing competition from chip companies which has pushed the company to cut prices. The CEO said they will remain competitive and protect their position as they expand their reach.
