Intel Reports Its Biggest Loss in History

Foreks - Intel (NASDAQ: INTC) reported a loss of $16.6 billion in the third quarter due to over $18 billion in restructuring and impairment costs. This $16.6 billion loss is the largest in Intel's 56-year history and significantly surpasses analysts' expectations of a $1.1 billion loss. Additionally, Intel's revenue for the quarter was $13.3 billion, a 6% decrease compared to the same period last year, but slightly above Wall Street forecasts. The company projected better-than-expected sales growth in the current quarter.

Executives expect Intel to continue its recovery in the fourth quarter, predicting revenues between $13.3 billion and $14.3 billion, which represents a year-over-year decline of 7.14% to 13.6%.

Intel's stock price rose by up to 15% in after-hours trading, following quarterly results that investors interpreted as positive. In the third quarter, Intel faced expenses exceeding $18.5 billion, partly related to a $10 billion budget cut plan announced amid layoffs in the previous quarter. As one might expect, the layoff of 15,000 employees by year-end will yield significant future cash savings for Intel, though it requires substantial severance and early retirement payouts in the short term. According to CEO Pat Gelsinger, the majority of layoffs took place during the quarter, contributing only $2.2 billion of the overall costs. CFO David Zinsner explained that the largest portion of the losses resulted from the decision to write off $9.9 billion in deferred tax assets accumulated due to losses over the past three years.