Intel shares rise on Q4 beat

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Intel Corporation (NASDAQ: INTC) reported its fourth quarter financial results for fiscal year 2017 and beat analysts’ estimates. Share were trading 9 percent higher on Friday after open.

For the fourth quarter, Intel reported a record fourth quarter revenue of $17.1 billion, along with a record full year revenue of $62.8 billion. Excluding McAfee, fourth quarter revenue grew 8 percent year over year. Revenue is up 4 percent year over year. Intel reported an EPS of $1.08, increasing 37 percent year over year, and beating analysts’ estimates of $0.87.

Intel’s data-centric business drove the strong quarter, as it accounted for 47 percent of Intel’s revenue, an all time high. The Data Center Group (DCG) increased 20 percent, Internet of Things Group (IOTG) increased 21 percent and Programmable Solutions Group (PSG) increased 35 percent year over year. Overall, data-centric business increased 21 percent year over year.

PC-Centric business reported revenue of $9 billion, but fell 2 percent year over year.

In 2017, Intel generated a record of $22 billion cash from operations and returned back $9 billion to shareholders. Intel has now announced to increase its cash dividend to $1.20 per share on an annual basis, a 10 percent increase.

Intel took a one time charge of $5.4 billion in the fourth quarter due to the tax reform.

"2017 was a record year for Intel with record fourth-quarter results driven by strong growth of our data-centric businesses," said Brian Krzanich, Intel CEO. “The strategic investments we've made in areas like memory, programmable solutions, communications and autonomous driving are starting to pay off and expand Intel's growth opportunity.”

Intel recently faced problems regarding its processor chips and how the company handled the malicious contents. The malware, Meltdown and Spectre, was a breach that allowed users to steal private information from others.

During processor crisis, it was made public that Google had informed Intel of the breach last year in June and that Krzanich had sold off his shares to meet the minimum shares required under his agreement of 250,000.

Intel has now begun to roll out updates and patches to fix the Meltdown and Spectre malware content on processors.

“In 2018, our highest priorities will be executing to our data-centric strategy and meeting the commitments we make to our shareholders and our customers." said Krzanich.

For 2018, Intel forecasts revenue between $64 and $66 billion and an EPS of $3.55, plus or minus 5 percent. Thomson Reuters’ analysts are estimating an EPS of $3.27 on $63.8 billion for revenue.

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