What the market expects to see in Intel reports – Global Markets

Last week, Intel shares jumped

INTEL CORPORATION
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(INTC) Close to 10% in one trading day. The reason? The company’s CEO Bob Swan, a greyish financier, resigned, and in his place the company announced the appointment of Bapt. To VMware.After a decade, he is now returning to Intel at the front door and investors have laid out a red carpet for him.

Intel’s new CEO – everything you need to know about him and will he bring about the desired change?
Why? Because the one who was formerly called the “Queen of Chips” has long been no queen. Don’t get me wrong, Intel is still the largest chipmaker in the world and has a market capitalization of $ 240 billion. But a queen is not. If so, then she is imprisoned in a palace while she sees her kingdom crumbling around, as more and more players, including Aiamdi (AMD), NVIDIA (NVDA), Taiwanese TSMC and Chinese manufacturers are biting her market share that is shrinking, as the market also spreads in terms of quantity types The chips, but also in terms of the technological knowledge required for production.

Take TSMC for example. The company plans to increase its R&D budget to $ 28 billion, from $ 17 billion in 2020. Furthermore, the company showed a 31% increase in revenue in 2020 and reached over $ 45 billion. A record amount for it.

AMD is also experiencing a record year, which is also reflected in the stock, which has jumped from a level of $ 50 to $ 90 per share in the last 12 months. 80% increase. The expansion of other chipmakers is indicative of the narrowing of Intel’s exclusive control of the market.

The market expects to see outsourcing
As a tradition of maintaining field security and technological advantage, Intel has always produced the processors it has developed in the development division in which it invests tens of billions of dollars a year. This has led to quite a few voices in the market calling on the company to give up its assembly division and concentrate only on development. That means selling the outrageously expensive divisions needed to produce processors and just outsource production or do licensing on the technology. It makes sense. Especially in light of the many production problems that the company has encountered in recent years, which obscure the forecasts and also the willingness of investors to invest.

And this is what the market expects to see: Some of the company’s production began outsourcing in the last quarter. Swan said he will reveal his decision in the current quarter, but now that he has been replaced, it could and will probably take time for Glasinger to come to a conclusion as to what is right for the company in this sector.

In any case, in addition to the boost that home computing has received in the shadow of the plague, so has the boost to cloud services, where Xeon processors are at the heart of many servers are expected to benefit. Intel also says it will have important news about the production line of 7-nanometer processors, the problems reported by the company last July led to a 16% crash in the stock price, due to the postponement of the schedule for the year.

What does the company expect and what is the consensus?
The company’s forecast for full-year revenue stands at $ 75 billion, up 5% from last year. This is based on the boom in computer sales from 2020. The consensus on the Wall Street predicts a 7% drop according to the Wall Street Journal. According to Bloomberg, the consensus predicts a 13% drop in company revenue and a 18% drop for the entire year. For 2021, the consensus is expected to see another 7% drop in sales.

Since the beginning of the year the stock has risen 15%, from a level of $ 51 per share to close to $ 59 per share as of this writing. However in the last 12 months it has fallen by 14.3%. According to the consensus, the share price is lacking in pricing, with the short-, medium- and long-term outlook positive.