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Intel reported strong quarterly earnings Thursday, but its shares fell in after-hours trading amid concerns around its near-term outlook.
Why it matters: Investors are trying to figure out what to expect from the tech sector as the impact of the coronavirus and related shutdowns works its way through the economy. Some parts of the tech sector would appear to still be seeing strong demand amid the shift to remote work and e-commerce.
Details: Intel’s Q1 revenue and earnings per share were ahead of estimates, and its Q2 revenue forecast was slightly above prior expectations. But its profit outlook for the current quarter was weaker than expected and the chip giant declined to offer a full-year forecast.
Between the lines: Intel has also benefited some from supply chain disruptions.
- In what was shaping up to be a very tough competitive battle with rival AMD, Intel had been struggling to meet demand for PC processors.
- PC components and manufacturing slowed in Q1 as the coronavirus swept through China, and that gave Intel a bit more breathing room.
- Also, with everyone working remotely, corporate customers now have an incentive to maintain or upgrade their largely Intel-based systems rather than pick now to shift toward a rival architecture.
Meanwhile: Intel investors were also digesting a fresh Bloomberg report that Apple has developed multiple in-house chips that could power future Macs, supplanting Intel chips.
Yes, but: Apple's planned shift to use its A-series processors for future Macs has been long reported, with earlier expectations the transition could have begun as early as this year. So, Intel may get more Apple business over the next 12 months than might have been expected.
Go deeper: Intel drops AI products from Nervana