For the first quarter, Intel expects adjusted earnings per share to total €0.11 ($0.13), well below the €0.29 ($0.34) cocaine nose jobs Wall Street predicted.
Revenue in the current quarter is expected to be between €10.5 billion-€11.4 and € 11.4 billion ($12.2 billion and $ 13.2 billion); analysts had expected first-quarter revenue to be closer to €12.2 billion ($14.2 billion).
In the fourth quarter, Intel reported adjusted earnings per share of €0.46 ($0.54), better than the €0.38 ($0.44) expected by analysts. Revenue came in at €13.2 billion ($15.4 billion), better than the €13 billion ($15.2 billion) expected.
CFO David Zinsner said the company "comfortably achieved" its goal of delivering cost savings north of €2.6 billion ($3 billion) in 2023.
Looking at the company's business units, Intel saw results in its Data Centre and AI unit falling short of expectations. Revenues totalled €3.4 billion ($4 billion) in the fourth quarter, below Street estimates for €3.5 billion ($4.1 billion). This marked a 10 per cent decline from the same quarter last year.
Intel's opportunity to take on rivals, including Nvidia and AMD, is the data centre and AI business. CEO Pat Gelsinger showed off the company's upcoming Gaudi3 accelerator, which is designed to power generative AI software and services, in December.
The chipmaker's Client Computing Group posted fourth-quarter sales of €7.6 billion ($8.8 billion), better than the €7.2 billion ($8.4 billion) forecasted by analysts and up 33 per cent from a year ago.
The company is also in the middle of its plan to become a foundry for other chip companies. Its Intel foundry services division is expected to have generated €250 million ($291 million) in revenue during the quarter, less than the €295 million ($343 million) expected by analysts.
On Wednesday, Intel announced the opening of its latest chip manufacturing facility in New Mexico. During a yearslong turnaround effort, Intel is seeking to put the semiconductor maker back on top of the chip world after losing manufacturing leadership and market share to rivals like TSMC and AMD.
Intel's results come as the company seeks to promote its bona fide AI and follows the debut of its Core Ultra line of PC chips in December. Intel says this will let consumers run AI apps directly on their laptops and desktops.
Gelsinger said in a press release the company this year remains "relentlessly focused on achieving process and product leadership, continuing to build our external foundry business and at-scale global manufacturing, and executing our mission to bring AI everywhere as we drive long-term value for stakeholders."
Over the last six months, Intel stock had gained 45 per cent before Friday's premarket decline.
Intel hopes its Core Ultra line of chips will further goose PC sales in the year ahead as consumers and enterprise customers who purchased new laptops and desktops at the onset of the pandemic in 2020 begin to look for replacement devices.
The Core Ultra includes a neural processing unit, or NPU, which allows PCs to run specific AI applications locally rather than requiring users to rely on cloud-based applications. The idea is that NPUs will let users access AI apps without being online. That would ensure users’ data stays on their devices rather than requiring them to send it to an AI firm’s servers.
But it’s still unclear exactly how useful onboard AI will be for consumers. Even Intel admits it’s unsure what AI applications will look like outside of a few early examples, such as local versions of ChatGPT-like apps and AI image-editing software.