Intel Corp. (NASDAQ: INTC) posted mixed results for its first quarter on Tuesday. Earning topped analysts’ estimates while revenue miss estimates. The company also announced restructuring program to cut 12,000 jobs.
The world’s biggest semiconductor company said that first-quarter net income rose 2.7 percent to $2.05 billion, or 42 cents a share, compared with $1.99 billion, or 41 cents a shares, a year earlier. Excluding certain items, earnings were 54 cents a share for the quarter ended in March. Analysts surveyed by Thomson Reuters had projected earnings of 48 cents.
Revenue rose 7 percent to $13.7 billion that fell short of analysts’ estimates of $13.8 billion.
The company provided a soft guidance for second quarter. The company expects that second-quarter revenue will be $13.5 billion, plus or minus $500 million. Analysts polled by Thomson Reuters expected revenue of $14.2 billion.
The company see continues decline in its PC business. Sales of PCs dropped nearly 10 percent in the first quarter, marking its fifth straight annual decline. The company is shifting focus to higher-growth areas, such as selling chips for servers and other gear related to cloud computing.
“We are making the shift; we are going to push over the edge,” Chief Executive Officer Brian Krzanich said on CNBC. “The PC industry will bottom out, but we need to operate efficiently and maximize profit in that time while shifting into faster-growth areas.”
The company also announced the biggest layoffs since 2009. The restructuring program plans to cut 12,000 jobs, representing 11 percent of Intel’s workforce. Krzanich described the move as tough but necessary, saying that it is not only to reduce cost, but also to free up money to invest in growing business.
Intel shares rose 1.57 percent to $32.09 at 12:06 p.m. at New York.