Computer industry recovery may have begun! Intel's second-quarter performance and third-quarter guidance exceeded expectations, with the stock price rising more than 7% after hours | Earnings Report Insights

On Thursday, July 27, Intel announced its results for the second quarter as of July 1 this year. **Intel's second-quarter revenue fell 15% year-on-year to $12.9 billion, higher than market expectations of $12.02 billion, according to the financial report. Gross margin fell 0.7 percentage points to 35.8 in the second quarter from a year earlier. Earnings per share in the second quarter were $0.35, and earnings per share in non-GAAP fell 54% to $0.13. **The company's second-quarter revenue and net profit both exceeded the highest range of the company's own guidelines. However, Intel's gross margin is still well below the 60% level it has maintained for many years, when the company had a dominant market share and production plants.! In the second quarter, Intel offered shareholders a quarterly dividend of 12.5 cents per share. In addition, the company said it is on track to achieve $3 billion in cost savings by 2023. **Intel expects moderate recovery in 2H20. The company expects third-quarter revenue of $12.9 billion, slightly lower than analysts' expectations of $13.28 billion; third-quarter adjusted revenue 12.9 billion to $13.9 billion, with a median higher than analysts' expectations of $13.28 billion. The company expects earnings per share of $0.04 in the third quarter and $0.2 per share in non-GAAP. Intel expects a gross margin of 43% in the third quarter, higher than the market expectation of 41%. **** Market analysis believes that Intel's performance guidance for the third quarter exceeded expectations, which means that the market's demand for computer components is improving, and the industry's long-awaited recovery may have begun. The analysis believes that Intel's performance guidance also shows that Intel has come out of trouble after the downturn in demand for personal computer chips has hit its business hard. **The company's management had promised an improvement in the second half of the year, and now investors are seeing new evidence. But the company is still in the early stages of turning a profit, depending on whether the re-Intel can establish its once-rock-solid leadership in chip technology. Many investors still doubt whether Intel will recover in the second half of the year. In the AI tide since the end of last year, chip manufacturers such as Nvidia and AMD have risen sharply, but Intel is considered by the market to be relatively backward in the AI field. Although Intel has shown signs of recovery, it is still far from its heyday. In 2021, the company's quarterly sales will exceed $20 billion. Intel rose more than 7.5 percent after U.S. stocks on Thursday, driven by the company's second-quarter results and third-quarter guidance that exceeded expectations.! In terms of split business, Intel's customer computing business revenue fell 12% to US $6.78 billion in the second quarter, higher than the market expectation of US $6.1 billion. Revenue from data center and artificial intelligence business fell 15% to US $4 billion, higher than the market expectation of US $3.82 billion. Revenue from network and innovation business dropped 38% to US $1.4 billion. Revenue from MobilEye business dropped slightly by 1% to US $0.454 billion; intel's Foundry services business surged 307 percent year-over-year to $0.232 billion.! Judging from the operating profit margin, the operating profit margin of Intel's customer computing business in the second quarter was 15%, the operating loss rate of data center and artificial intelligence business was 4%, the operating loss rate of network and innovation business was 14%, the operating profit margin of MobilEye business was 28%, and the operating loss rate of Intel's Foundry service business was 62%.! Although Intel's share price has risen nearly 30% this year as of Thursday's close, its performance is still lower than the overall increase in the U.S. chip sector. The Philadelphia Semiconductor Index has risen 49% this year.!