Intel disappoints with its data center business

(Reuters) – Intel on Thursday reported lower than expected revenue in its third-quarter data center business as its institutional and business customers cut back on chip purchases due to the COVID-19 pandemic.

The stock fell 10% in trading after the close on Wall Street.

The high-margin division’s revenue contracted 7% to $ 5.9 billion (€ 5 billion) as analysts expected an average of $ 6.21 billion, according to FactSet.

Intel is the leading supplier of processors for personal computers and data centers, but the American group has been confronted with manufacturing delays, which have benefited competitors such as Advanced Micro Devices or Nvidia, which use service providers for their process. manufacturing.

Intel said spending by its institutional and business customers on data center chips slumped 47% after two quarters of growth above 30%.

Excluding exceptional items, the group achieved quarterly profit of $ 1.11 per share, in line with the consensus according to IBES data from Refinitiv.

He said he expected fourth-quarter revenue of around $ 17.4 billion, barely higher than analysts’ expectations of $ 17.36 billion.

(Munsif Vengattil, Ayanti Bera and Stephen Nellis; French version Bertrand Boucey)

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