Intel posted 2022 revenue of $63.1 billion with a gross margin of 47.3%, compared to a forecasted revenue of $76 billion.
“We lost share, we lost momentum. We think it will plateau this year,” Intel Chief Executive Pat Gelsinger told investors on a conference call. He said Intel’s share of the data center market has been declining, a nod to the strength of rival Advanced Micro Devices (AMD).
Intel’s fourth-quarter revenue fell 32% to $14 billion. Intel is targeting $1.05-11.5 billion in the first quarter of 2023.
“During the fourth quarter, we took steps to right-size our organization and rationalize our investments, prioritizing areas where we can deliver the highest value over the long-term,” Intel Chief Financial Officer David Cinsner said in its earnings report.
“These actions underpin our 2023 cost reduction target of $3 billion and lay the foundation for achieving $8 billion to $10 billion by the end of 2025.”
The data center market also slowed from double-digit growth as companies cut costs to ride out the economic slowdown.
PC shipments will drop 16.5% to 292.3 million units in 2022, according to research firm IDC, forcing chipmakers to cut production and lower revenue forecasts.
Intel has been focused on regaining its leadership in chipmaking technology. Outsourcing the chipmaking process has helped rivals like AMD make smaller, faster chips and outperform Intel’s technology.
business unit revenue
Client Computing Group (CCG) $6.6 billion in Q4 2022 (–36%) and $31.7 billion in 2022 (–23%)
Data Center and Artificial Intelligence (DCAI) $4.3 billion (–33%) in Q4 2022 and $19.2 billion (–15%) in 2022
Network and Edge (NEX) $2.1 billion in Q4 2022 (–1%), $8.9 billion in 2022 (+11%)
Mobileye $565 million (+59%) in Q4 2022 and $1.9 billion (+35%) in 2022
Accelerated computing systems and graphics (AXG) $247 million (+1%) in Q4 2022 and $837 million (+8%) in 2022
Intel Foundry Services (IFS) $319 million (+30%) in Q4 2022 and $895 million (+14%) in 2022
PSG (Programmable Solutions Group)
Intel’s CCG (Client Computing Group) revenue fell 36% to $6.6 billion as economic headwinds caused PC TAMs to deteriorate faster. CCG achieved a record CPU ASP, up 11%, driven by the leading performance and compelling features of the Evo and vPro platforms.
Intel’s DCAI (Data Center and Artificial Intelligence Group) revenue fell 33% to $4.3 billion, driven by TAM shrinkage and competitive pressure.
Intel’s NEX (network and edge group) revenue fell 1% to $2.1 billion as lower GDP hit the edge business, offsetting growth in Xeon networking CPUs and growth in Mount Evans infrastructure processing units.
Intel’s AXG (Accelerated Computing Systems and Graphics) business posted record quarterly revenue of $247 million (+1%), backed by the launch of Sapphire Rapids HBM.
Intel’s Mobileye revenue rose 59 percent to $565 million. Mobileye’s full-year revenue was $1.9 billion, up 35%.
Intel’s IFS (Intel Foundry Services) revenue rose 30% to $319 million due to higher car shipments.
Intel will end future investments in its network switching product line while continuing to support existing products and customers.
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