Osprey Flyer: Intel Earnings Rise to $3.5B (Charts, Videos) *Record revenues, net income, EPS* INTC

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Intel reported Q3 2011 financial results on October 18, 2011

*Charts and commentary have been updated for Intel Q3 2011 financial results*

Intel Earnings Rise to $3.5B: Record revenues, net income, EPS

Intel Summary Q3 2011 Intel rebounded in Q3 2011 with record total revenues, net income, and earning per share. Revenue growth was driven by data centers and developing countries, notably China. "Emerging markets are good, enterprise is strong, the mature market consumer is a little bit weaker," said Chief Financial Officer Stacy Smith. Investor confidence is strengthened by the latest financial results, after being deflated somewhat in the prior quarter. Hopefully this growth can continue and appears so based on Intel's Q4 2011 outlook. Financial position continues strong.

Intel Income Statement Q3 2011 Intel reported record total revenues of $14.23 billion, record net income of $3.47 billion, and record earnings per share of $0.65. From the prior quarter Q2 2011, total revenues were up +9.22%, net income up +17.40%, and earnings per share were up at +20.37%. From the prior year Q3 2010, total revenues were up +28.20%, net income up +17.36%, and earnings per share up +25.00%. Gross margin increased QoQ to 63.36%, operating margin increased QoQ to 33.62%, and net margin increased QoQ to of 24.37%. The operating expense ratio has been stable and is currently 29.74%.

Intel Balance Sheet Q3 2011 Intel continues liquid and well capitalized. Total assets have reached an all-time high of $77.05 billion. The current ratio, current assets / total assets, increased QoQ to 37.84%. Intel has $10+ billion in short-term cash, cash equivalents, and marketable securities. Capital to assets, total stockholders' equity / total assets, decreased QoQ to 65.37% from 73.72% due to an increase in debt. The debt ratio, short-term and long-term debt to total assets, increased QoQ to 10.12% from 3.27%. Return on assets of 19.58% continues at recent levels and above the historical average.

Intel Q4 2011 Business Outlook

Q4 2011 (GAAP)

• Revenue: $14.7 billion, plus or minus $500 million.

• Gross margin percentage: 65 percent, plus or minus a couple percentage points.

Intel Performance by the Quarters (Charts)

Intel Earnings Per Share (Chart) Below is a chart of quarterly earnings per diluted share. Current Earnings per Share of $0.65 is a record high, a +20.37% increase QoQ, and a and +25.00% YoY increase. The chart average EPS is $0.36.

Intel Total Revenues, Operating Income, and Net Income (Chart) Below is a chart of quarterly total revenues, quarterly operating income, and quarterly net income. Current Total Revenues of $14.23 billion is a record high, a +9.22% increase QoQ, and a +28.20% increase YoY. Current Operating Income of $4.79 billion is a record high. Current Net Income of $3.47 billion is a record high, a +17.40% increase QoQ, and a +17.36% increase YoY. The chart averages for TR, OI, and NI are $10.56 billion, $2.99 billion, and $2.13 billion, respectively.

Intel Gross Margin, Operating Margin, and Net Margin (Chart) Below is a chart of quarterly gross margin, operating margin, and net margin. Current Gross Margin of 63.36% is a 3-quarter high. Current Operating Margin of 33.62% is a 3-quarter high. Current Net Margin of 24.37% is a 2-quarter high. The chart averages for GM, OM, and NM are 59.79%, 26.80%, and 11.76%, respectively.

Intel Return on Assets (Chart) Below is a chart of annual return on average assets per quarter. The total net income for the most recent 4 quarters is divided into average assets for the most recent 4 quarters to obtain a rolling annualized ROA, an annualized return on average assets for the 12 months (4 quarters) ended. Current Return on Assets of 19.58% is historically strong and slightly increased QoQ and YoY. The ROA chart average is 13.73%.

Intel Geographic Revenues (Chart) Below is a chart of revenues by region. Asia Pacific at $8.05 billion is the primary driver of sales growth and is 56.56% of total revenues. Americas at $3.02 billion is flattening and is 21.20% of total revenues. Europe at $1.81 billion increased and is 12.75% of total revenues. Japan at $1.35 billion increased and is 9.50% of total revenues.

Intel Growth Rates (Chart) Below is a chart of the annual (YoY, Y/Y, annual change) growth rates for revenues and earnings per share. Current Total Revenues Growth of +28.20% is historically above average and the 6th consecutive quarter of growth. Current Earnings per Share Growth of +25.00% is historically below average but the 5th consecutive quarter of growth. The chart below covers only some recent quarters through the latest quarter reported. The rapid plunge in total revenues and earnings per share and the subsequent rebound as a result of the Great Recession and subsequent recovery resulted in some extreme percentages that obscure recent data. The chart averages for TRG and EPSG are +20.13% and +31.74%, respectively.

Intel Operating Expense Ratio (Chart) Below is a chart of the quarterly operating expense ratio, which is operating expenses divided by total revenues. Current Operating Expense Ratio of 29.74% is historically below average. The OER has been stable for the past 7 quarters, which is encouraging for investors. The OER chart average is 33.00%.

Intel Reports Record Revenue and Profit

* $3.1 Billion Year-Over-Year Revenue Increase Fueled by Double-Digit PC Unit Growth and Data Center Strength

* Buyback Authorization Increased by $10 Billion

SANTA CLARA, Calif., Oct. 18, 2011 - Intel Corporation today reported third-quarter results, setting new records for microprocessor units shipped, EPS, earnings and revenue, which was up 28 percent year-over-year.

"Intel delivered record-setting results again in Q3, surpassing $14 billion in revenue for the first time, driven largely by double-digit unit growth in notebook PCs," said Paul Otellini, Intel president and CEO. "We also saw continued strength in the data center fueled by the ongoing growth of mobile and cloud computing."

On a Non-GAAP basis, revenue was $14.3 billion, operating income was $5.1 billion, net income was $3.7 billion and EPS was 69 cents. On a GAAP basis, the company reported third-quarter revenue of $14.2 billion, operating income of $4.8 billion, net income of $3.5 billion and EPS of 65 cents.

The company generated approximately $6.3 billion in cash from operations, paid cash dividends of $1.1 billion, and used $4.0 billion to repurchase 186 million shares of common stock. Intel's board of directors also voted to increase the company's buyback authorization by $10.0 billion, raising the total unused balance to $14.2 billion at the end of the third quarter. The company also completed a senior notes offering of $5.0 billion primarily for the purpose of repurchasing stock.

About Intel

Intel, the world leader in silicon innovation, develops technologies, products, and initiatives to continually advance how people work and live. Founded in 1968 to build semiconductor memory products, Intel introduced the world's first microprocessor in 1971. Intel's mission statement, values, and objectives:

Our mission

Delight our customers, employees, and shareholders by relentlessly delivering the platform and technology advancements that become essential to the way we work and live.

Our values

Customer orientation

Results orientation

Risk taking

Great place to work

Quality

Discipline

Our objectives

Extend our silicon technology and manufacturing leadership

Deliver unrivaled microprocessors and platforms

Grow profitability worldwide

Excel in customer orientation