Advanced Computing in the Age of AI | Thursday, September 23, 2021

Intel Reports Second-Quarter 2021 Financial Results 

SANTA CLARA, Calif., July 23, 2021 -- Intel Corporation reported second-quarter 2021 financial results.

“There’s never been a more exciting time to be in the semiconductor industry. The digitization of everything continues to accelerate, creating a vast growth opportunity for us and our customers across core and emerging business areas. With our scale and renewed focus on both innovation and execution, we are uniquely positioned to capitalize on this opportunity, which I believe is merely the beginning of what will be a decade of sustained growth across the industry,” said Pat Gelsinger, Intel CEO. “Our second-quarter results show that our momentum is building, our execution is improving, and customers continue to choose us for leadership products.”

Q2 2021 Financial Highlights

  • Second-quarter GAAP revenue of $19.6 billion, flat year over year (YoY), and non-GAAP revenue of $18.5 billion, up 2% YoY, which exceeded April guidance by $700 million.
  • Second-quarter GAAP earnings-per-share (EPS) was $1.24; non-GAAP EPS was $1.28, which exceeded April guidance by $0.23.
  • Exceeded Q2 guidance for revenue, EPS, and gross margin; record Q2 revenue in PC and Mobileye businesses.
  • Raising full-year 2021 guidance. Now expecting GAAP revenue of $77.6 billion and non-GAAP revenue of $73.5 billion; GAAP EPS of $4.09 and non-GAAP EPS of $4.80.1
GAAP Non-GAAP
Q2 2021 Q2 2020 vs. Q2 2020 Q2 2021 Q2 2020 vs. Q2 2020
Revenue ($B) $19.6 $19.7 flat $18.5 $18.2 up 2%
Gross Margin 57.1% 53.3% up 3.8 ppt 59.2% 56.3% up 2.9 ppt
R&D and MG&A ($B) $5.3 $4.8 up 11% $5.1 $4.6 up 11%
Operating Margin 28.3% 28.9% down 0.6 ppt 31.6% 31.0% up 0.6 ppt
Tax Rate 11.9% 14.0% down 2.1 ppt 11.9% 14.1% down 2.3 ppt
Net Income ($B) $5.1 $5.1 down 1% $5.2 $4.9 up 6%
Earnings Per Share $1.24 $1.19 up 4% $1.28 $1.14 up 12%

In the second quarter, the company generated $8.7 billion in cash from operations and paid dividends of $1.4 billion.

Business Unit Summary

Key Business Unit Revenue and Trends Q2 2021 vs. Q2 2020
CCG $10.1 billion up 6%
DCG $6.5 billion down 9%
Internet of Things
IOTG $984 million up 47%
Mobileye $327 million up 124%
NSG $1.1 billion down 34%
PSG $486 million down 3%

 

Second-quarter revenue exceeded April guidance led by continued strength in Intel's Client Computing Group (CCG) and strong recovery in both Intel's Internet of Things Group (IOTG) and the Enterprise portion of its Data Center Group (DCG).

The PC and Mobileye businesses both achieved record Q2 revenue. In the second quarter, PC platform volumes were up 33 percent YoY and Mobileye closed 10 additional design wins for more than 16 million total lifetime units.

Business Highlights

▪       Announced a $3.5 billion investment to equip Intel’s New Mexico operations for the manufacturing of advanced semiconductor packaging technologies, including Foveros.

▪       Launched 12 new processors for client, including 11th Gen Intel Core with Intel Iris Xe graphics and Intel Xeon W-11000 series processors with more than 300 designs expected this year.

▪       Announced partnership with Microsoft including Intel Bridge Technology to deliver better mobile experiences on Windows-powered PCs.

▪       Leading cloud service providers, including Alibaba, Baidu, Microsoft, and Oracle are offering services based on the latest 3rd Gen Intel Xeon Scalable (“Ice Lake”) processors.

▪       Unveiled the Intel Network Platform and expanded networking leadership product portfolio with new FPGA, software, and Ethernet solutions.

▪       Announced partnership with Ericsson to expand cloud radio access network to increase 5G performance.

▪       Mobileye and ZF were selected by Toyota Motor Corp to develop advanced driver assistance systems.

▪       Announced Mobileye as the only company holding an autonomous vehicle testing permit in New York.

▪       Announced new organizational changes and welcomed renowned technologists to strengthen execution and innovation in critical business areas.

As part of its IDM 2.0 strategy, Intel is accelerating its annual cadence of innovation with new advancements in semiconductor process and packaging. Join the public webcast at newsroom.intel.com at 2 p.m. PDT on Monday, July 26, for more information on Intel’s process and packaging roadmaps.

Additional information regarding Intel’s results can be found in the Q2'21 Earnings Presentation available at:

www.intc.com.

Business Outlook

Intel's guidance for the third quarter and full year includes both GAAP and non-GAAP estimates. Our Non-GAAP measures exclude the NAND memory business, which is subject to a previously-announced pending sale, as well as certain other items. Reconciliations between GAAP and non-GAAP financial measures are included below. Intel's guidance includes a one-time tax benefit to EPS of approximately $0.10 in Q3.

Q3 2021 GAAP Non-GAAP
Approximately Approximately
Revenue $19.1 billion $18.2 billion
Gross Margin 53% 55%
Tax rate 4% 4%
Earnings per share $1.08 $1.10

 

Full-Year 2021 GAAP Non-GAAP
Approximately Approximately
Revenue $77.6 billion $73.5 billion
Gross Margin 54.2% 56.5%
Tax rate 16% 11%
Earnings per share $4.09 $4.80
Full-year capital spending $19.0-20.0 billion $19.0-20.0 billion^
Free cash flow N/A $11.0 billion

Actual results may differ materially from Intel’s Business Outlook as a result of, among other things, the factors described under “Forward-Looking Statements” below.

Intel Corporation

Consolidated Condensed Statements of Income and Other Information

Three Months Ended Six Months Ended
(In Millions, Except Per Share Amounts; unaudited) Jun 26, 2021 Jun 27, 2020 Jun 26, 2021 Jun 27, 2020
Net revenue $ 19,631  $ 19,728  $ 39,304  $ 39,556 
Cost of sales 8,425 9,221 17,244 17,033
Gross margin 11,206  10,507  22,060  22,523 
Research and development 3,715 3,354 7,338 6,629
Marketing, general and administrative 1,599 1,447 2,927 2,988
Restructuring and other charges 346 9 2,555 171
Operating expenses 5,660  4,810  12,820  9,788 
Operating income 5,546  5,697  9,240  12,735 
Gains (losses) on equity investments, net 295 267 663 156
Interest and other, net (96) (29) (252) (342)
Income before taxes 5,745  5,935  9,651  12,549 
Provision for taxes 684 830 1,229 1,783
Net income $ 5,061  $ 5,105  $ 8,422  $ 10,766 
Earnings per share—basic $ 1.25  $ 1.20  $ 2.08  $ 2.53 
Earnings per share—diluted $ 1.24  $ 1.19  $ 2.06  $ 2.50 
Weighted average shares of common stock outstanding:
Basic 4,049  4,246  4,053  4,256 
Diluted 4,084  4,284  4,090  4,298 

 

Three Months Ended
(In Millions) Jun 26, 2021 Jun 27, 2020
Earnings per share of common stock information:
Weighted average shares of common stock outstanding—basic 4,049  4,246 
Dilutive effect of employee equity incentive plans 35 38
Weighted average shares of common stock outstanding—diluted 4,084  4,284 
Stock buyback:
Shares repurchased
Cumulative shares repurchased (in billions) 5.8 5.5
Remaining dollars authorized for buyback (in billions) $ 7.2 $ 19.7
Other information:
Employees (in thousands) 113.7 110.8

 

 

Intel Corporation

Consolidated Condensed Balance Sheets

(In Millions) Jun 26, 2021 Dec 26, 2020
Assets (unaudited)
Current assets:
Cash and cash equivalents $ 4,746 $ 5,865
Short-term investments 3,014 2,292
Trading assets 17,097 15,738
Accounts receivable 7,460 6,782
Inventories
Raw materials 1,010 908
Work in process 5,968 5,693
Finished goods 1,839 1,826
8,817  8,427 
Assets held for sale 5,817 5,400
Other current assets 2,421 2,745
Total current assets 49,372  47,249 
Property, plant and equipment, net 58,166  56,584 
Equity investments 5,655  5,152 
Other long-term investments 1,262  2,192 
Goodwill 26,768  26,971 
Identified intangible assets, net 8,018  9,026 
Other long-term assets 5,356  5,917 
Total assets $ 154,597  $ 153,091 
Liabilities
Current liabilities
Short-term debt $ 3,695 $ 2,504
Accounts payable 5,917 5,581
Accrued compensation and benefits 3,176 3,999
Other accrued liabilities 12,048 12,670
Total current liabilities 24,836  24,754 
Debt 31,714  33,897 
Contract liabilities 68  1,367 
Income taxes payable 4,172  4,578 
Deferred income taxes 3,271  3,843 
Other long-term liabilities 5,329  3,614 
Stockholders' equity
Common stock and capital in excess of par value, 4,057 issued and outstanding (4,062 issued and outstanding as of December 26, 2020) 26,655 25,556
Accumulated other comprehensive income (loss) (1,095) (751)
Retained earnings 59,647 56,233
Total stockholders' equity 85,207  81,038 
Total liabilities and stockholders' equity $ 154,597  $ 153,091 

 

 

Intel Corporation

Consolidated Condensed Statements of Cash Flows

Six Months Ended
(In Millions; unaudited) Jun 26, 2021 Jun 27, 2020
Cash and cash equivalents, beginning of period $ 5,865  $ 4,194 
Cash flows provided by (used for) operating activities:
Net income 8,422 10,766
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 4,862 5,248
Share-based compensation 1,044 941
Restructuring and other charges 2,555 171
Amortization of intangibles 897 865
(Gains) losses on equity investments, net (555) (92)
Changes in assets and liabilities:
Accounts receivable (678) 224
Inventories (126) (271)
Accounts payable 425 208
Accrued compensation and benefits (836) (1,025)
Prepaid supply agreements (1,571) (161)
Income taxes 114 1,203
Other assets and liabilities (259) (762)
Total adjustments 5,872 6,549
Net cash provided by operating activities 14,294  17,315 
Cash flows provided by (used for) investing activities:
Additions to property, plant and equipment (7,574) (6,676)
Additions to held for sale NAND property, plant and equipment (682)
Purchases of available-for-sale debt investments (2,000) (4,558)
Maturities and sales of available-for-sale debt investments 2,126 1,303
Purchases of trading assets (14,637) (11,429)
Maturities and sales of trading assets 12,936 7,430
Other investing 380 (416)
Net cash used for investing activities (9,451) (14,346)
Cash flows provided by (used for) financing activities:
Issuance of long-term debt, net of issuance costs 10,247
Repayment of debt and debt conversion (500) (2,775)
Proceeds from sales of common stock through employee equity incentive plans 589 512
Repurchase of common stock (2,415) (4,229)
Payment of dividends to stockholders (2,821) (2,811)
Other financing (815) 629
Net cash provided by (used for) financing activities (5,962) 1,573 
Net increase (decrease) in cash and cash equivalents (1,119) 4,542 
Cash and cash equivalents, end of period $ 4,746  $ 8,736 

 

About Intel

Intel (Nasdaq: INTC) is an industry leader, creating world-changing technology that enables global progress and enriches lives. Inspired by Moore’s Law, we continuously work to advance the design and manufacturing of semiconductors to help address our customers’ greatest challenges. By embedding intelligence in the cloud, network, edge and every kind of computing device, we unleash the potential of data to transform business and society for the better. To learn more about Intel’s innovations, go to intel.com.

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Source: Intel

 

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