Intel’s revenue forecast drawers when investors are waiting for new CEO

(Reuters) -Intel’s forecast for the first quarter of revenue on Thursday missed analyst estimates as the chipmaker struggles with a warm demand for traditional data center chips and falling share in the most important personal computer market.

Shares in Santa Clara, California-based company fell close to 2% in fleeting extended trade. Last year, Intel’s shares lost approx. 60%.

As the chipmaker undergoes a historic transition and tries to emerge from one of its gloomy periods, it has also struggled to pay a boom in investing in advanced AI chips – a market led by Nvidia.

In his quarterly report after the clock, Intel said it expects revenue in the first quarter of $ 11.7 billion to $ 12.7 billion compared to analysts’ average estimate of $ 12.87 billion according to data prepared by LSEG.

Companies that want to benefit from generative AI technology have prioritized the cost of specialized AI processors that can hover huge amounts of data that shrinks the demand for the traditional server processors that Intel sells.

The company’s prospects “reflect seasonal weakness enlarged by macrous relatives, additional inventory and competition dynamics,” temporarily Co-Ceo and CFO David Zinsner said in a statement.

Intel last year scraped a 2024 forecast that it would sell over $ 500 million worth its new AI processors, named Gaudi, which suggested they were struggling to compete against Nvidia’s chips.

On an adjusted, per. Share Basis predicts Intel that it would break-enda for the current quarter. Analysts expect an adjusted profit of 9 cents per day. Stock.

It is strongly spending a contract manufacturer of chips for other companies, causing some investors to worry about pressure on its cash flows.

Former CEO Pat Gelsinger was postponed last month, leaving two temporary co-cos at the helm and enveloping Intel’s turnaround strategy in uncertainty.

Intel reported revenue in the fourth quarter dropped 7% from the previous year to $ 14.26 billion and beat estimates of $ 13.81 billion.

PC market – Intel’s largest after revenue share – so global shipments only increase modestly last year, and underpoint analysts’ expectations of a strong rebound after months of fall.

The company has also lost the share of the PC and Server CPU market to compete with AMD, a trendanalytic expects to continue into 2025.

(Reporting Arsheeya Bajwa in Bengaluru and Max Cherney in San Francisco; editing David Gregorio)