Intel jumps after upbeat forecast boosts optimism about chips

Image credit: Getty Images

Intel shares gained after the chipmaker gave a bullish revenue forecast for the current period, indicating that demand for computer components is improving.

Sales in the third quarter will be much as $13.9bn, the company said Thursday in a statement, compared with an average analyst estimate of $13.3bn. Minus certain items, Intel expects to post earnings of 20 cents a share, compared with a 13-cent profit projection.

The shares rose about 7 per cent in late trading after the report was released.

The outlook suggests Intel has turned a corner after sluggish demand for personal computer chips battered its business.

Management had promised that the second half of the year would show improvement, and now investors are seeing fresh evidence of that. But the company remains in the early stages of a comeback plan, which hinges on reestablishing Intel’s once-bulletproof lead in chip technology.

Though Intel stock has gained 31 per cent this year through Thursday’s close, that underperformed a rally by chip-related shares.

The Philadelphia Stock Exchange Semiconductor Index is up 49 per cent in 2023.

Read: Intel to sell 20% of IMS to Bain at $4.3bn valuation