Intel Shrugs Off Spectre Worries in Q4
Intel revealed a blowout fourth quarter on Thursday but the shadow of the major security vulnerabilities discovered in its CPUs at the beginning of the year was still in the air.
"We've been around the clock with our customers and partners to address the security vulnerability known as Spectre and Meltdown," CEO Brian Krzanich said right at the top of the call Thursday evening.
Intel is continuing to develop software fixes for the bugs but is planning on hardware in the longer term. "We're working to incorporate silicon-based changes to future products that will directly address the Spectre and Meltdown threats in hardware," the CEO said, stressing the situation is still highly "dynamic."
Nonetheless, Intel's revenue for the last quarter of 2017 was up 4% year-on-year at $17.05 billion. Earnings per share solidly beat Thomson Reuters expectations of $0.86 at $1.08.
Intel's largest unit, the Client Computing Group, brought in $9 billion, dropping 2% year-on-year compared to 2017. The Data Center Group -- now the second biggest unit -- however, grew 20%, generating $5.6 billion in revenue, while the Internet of Things unit grew 21% to $879 million.
This led the CEO to describe the fourth quarter as "our best quarter ever." And -- despite the spectre of silicon insecurity hanging over 2018 -- Intel is still expecting 2018 to be better.
For 2018, Intel is predicting revenue of $65 billion. Full-year revenue for 2017 was $62.8 billion.
"2018 will be another record year for Intel," Krzanich said.
The recent corporate tax cut will also give the chipmaker a fillip. CFO Bob Swan said that he expects Intel to pay an effective tax rate of 14% for 2018.
"This will level the playing field for US manufacturers," Swan said.
The earnings call didn't reference Intel's expected XMM8060 5G modem prototype arriving in 2018, with commercial silicon expected in the second half, and Apple rumored to be grooming Intel as its sole 5G modem supplier. Nonetheless, the CEO suggested Intel will be a leading 5G provider. (See Apple in Hiring Frenzy for 5G Device Design.)
The chipmaker was trading up 3.73% at $46.99 in after-hours trading Thursday.
— Dan Jones, Mobile Editor, Light Reading