INTEL (INTC)

EARNINGS RELEASE THURSDAY - OCTOBER 24 (AMC)

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JUMP REPORT

Avg Daily Volume: 20,848,800    Market Cap: 227.52B
Sector: Technology    Short Interest: 1.26

EARNINGS EXPECTATIONS:  

     THIS QTR:   EPS:      1.24/share     REV:  18,080/M
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     LAST QTR:  EPS:       -.36/share     ACTUAL:   -1.12/share  (MISS)
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     NEXT QTR:  EPS:      1,21/share     REV: 18,820/M
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     FULL YR:     EPS:       4.39/share    REV: 69,400/M
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*These are the base metrics we will be watching against the actual release numbers
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BEAT/MISS RECORD:  66%  OF THE TIME THEY BEAT ESTIMATES

PRIOR ‘JUMP ZONE’ MOVES (LAST 3 QTRS %) 2.56, -10.57, -8.05

EXPECTED JUMP MOVE:  8-10%

Links To Latest News and Headlines

(Bloomberg) — Intel Corp. agreed to sell its Nand memory unit to South Korea’s SK Hynix Inc. for about $9 billion, a deal that allows the U.S. chipmaker to concentrate on its main business while shoring up the Asian company’s position in a booming market.The chipmaker will pay 10.3 trillion won for the Intel unit, which makes flash memory components for computers and other devices. The acquisition, which will take place in stages through 2025, includes Intel’s solid-state drive, Nand flash and wafer businesses, as well as a production facility in the northeastern Chinese city of Dalian.The deal should shore up Hynix’s position in a business that’s boomed after Covid-19 drove demand for the chips used in everything from Apple Inc.’s iPhones to data centers. It whittles down another player in an industry the Korean company dominates alongside Samsung Electronics Co. and Micron Technology Inc., potentially buoying Nand flash prices. Hynix’s shares fell about 1.8% after analysts raised concerns about the price tag on its largest acquisition ever.“Hynix is now entering the hyperscale control chip business by purchasing Intel’s business. Although there is some skepticism about the price of the deal, I think this won’t be a burden because it will ensure solid long-term cash flow,” said Greg Roh, an analyst at HMC Securities. “The market consolidation is good news for Korean memory chipmakers, and will alleviate oversupply issues.”Read more: Intel ‘Stunning Failure’ Heralds End of Era for U.S. Chip SectorIntel has said for months it was exploring options for the flash group. Hynix however won’t be buying the Optane division, which develops chips that can permanently store data and read and write it faster than NAND — if not faster than traditional DRAM. The product, which went on sale in 2018, was tested successfully by some large cloud providers and Alibaba Group Holding Ltd. used the technology to support its massive Singles’ Day sales. Bob Swan, Intel’s chief executive officer, described Optane as “something special” last year.The Korean company said it will pay Intel $7 billion before the end of 2021, then the rest by March 2025. Citigroup advised Hynix, while Bank of America did the same for Intel. The deal could allow Hynix to surpass Kioxia — a Toshiba Corp. spinoff — in the Nand flash market, in particular, according to Bloomberg Intelligence analyst Anthea Lai.What Bloomberg Intelligence SaysSK Hynix’s agreement to acquire Intel’s memory chip unit for 10.3 trillion won will help the South Korean chipmaker surpass its second-biggest rival Kioxia by NAND flash revenue, we calculate. The deal would consolidate the NAND market, with Samsung, SK Hynix and Kioxia commanding more than 70% of revenue share, aiding NAND price recovery and narrowing losses, in our view.\- Anthea Lai, analystClick here for the research.The acquisition also further streamlines Intel’s struggling empire. Since taking over in 2019, Swan has looked to sell several units that aren’t part of the company’s focus on processors for personal computers and servers.The Santa Clara, California-based company has delayed production of important upcoming chip lines and now lags behind some industry players in manufacturing technology. Its shares are down about 9% so far this year, while the benchmark Philadelphia Semiconductor Index is up almost 29%.Despite the delays, the company’s server group has been performing well. Shedding another non-core business could help Intel focus on fixing its chip technology woes.Intel unloaded its smartphone cellular modem group to Apple in 2019 and this year sold its home connectivity chips group to MaxLinear Inc. In July, the company said it was considering moving away from manufacturing its own chips, potentially benefiting contract producers such as Taiwan Semiconductor Manufacturing Co. and Samsung.Read more: Intel’s Latest Chip Push Suggests the Company Has a Short Memory(Updates with share action and analyst’s comment from the third paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

Intel Corp has agreed to sell its NAND memory chip business to SK Hynix Inc for $9 billion in an all-cash deal that would propel the South Korean chipmaker to second in the global rankings. The move marks the latest effort by the U.S. chip giant to divest its non-core businesses, move away from the volatile commodity NAND chip industry and focus on its remaining Optane memory business, which is smaller but more lucrative because it taps more advanced technology. It is the biggest acquisition to date for SK Hynix and follows its $3.7 billion investment in Japanese rival Kioxia in 2017, as the Korean firm tries to boost its capacity to build NAND chips – used to store data in smartphones and data centre servers – and beef up its pricing power.

20 Oct, 2020 @ 01:59 by Yahoo! Finance

SK hynix and Intel today announced that they have signed an agreement on Oct. 20, KST, under which SK hynix would acquire Intel's NAND memory and storage business for US $9 billion.

20 Oct, 2020 @ 01:06 by Yahoo! Finance

Intel is one of the world's largest chipmakers. It designs and manufactures microprocessors for the global personal computer and data center markets. Intel pioneered the x86 architecture for microprocessors. It is also the prime proponent of Moore's law for advances in semiconductor manufacturing. While Intel's server processor business has benefited from the shift to the cloud, the firm has also been expanding into new adjacencies as the personal computer market has declined. These include areas such as the Internet of Things, memory, artificial intelligence, and automotive. Intel has been active on the merger and acquisitions front, recently acquiring Altera, Mobileye, Nervana, Movidius, and Habana Labs in order to assist its efforts in non-PC arenas.

20 Oct, 2020 @ 00:18 by Yahoo! Finance

(Bloomberg Opinion) — Intel Corp. has stumbled lately. To right itself, the semiconductor giant needs to get back to basics and prioritize its main business. An exit from the memory industry will help that effort.The company agreed to sell its Nand memory-chip subsidiary to South Korea’s SK Hynix Inc. for about $9 billion, the Asian chipmaker said in a statement late Monday New York time. Despite large investments in flash memory, Intel has never been able to become a big player in these types of semiconductors, which are used in storage devices inside computer hard drives and consumer electronics. That’s a problem because in a commodity market such as memory, leadership and size are essential to generate profits over the long term. With no prospects for large gains on the horizon, Intel is smart to give up on memory. First, the move can help the company’s bottom line. Earlier this month, Raymond James estimated Intel could boost its annual free cash flow by $2 billion if it left the memory business. Second, the prospects of this part of the chip industry aren’t very promising. This, analysts say, is because market leader Samsung is willing to flood the market if necessary to defend its leading position, without regard to maintaining its prices. Not a great situation for the other smaller players. Even Micron Technology Inc. CEO Sanjay Mehrotra hinted at those difficult industry dynamics during his earnings call last month. He noted the industry needs to reduce its factory investments if chipmakers wanted to improve the market’s profitability. This is a battle Intel doesn’t need to fight. But most importantly, Intel needs to focus on its primary business: central-processing unit (CPU) chips. Frankly, the company has gotten distracted with several needless acquisitions and forays into disparate markets such as security software, smartphone wireless chips and programmable FPGA chips. All those areas don’t matter if the company loses technical leadership in the CPU market. And after Intel revealed in July that another next-generation chip based on 7-nanometer manufacturing technology would be delayed, most analysts now believe Advanced Micro Devices Inc. has the prime position to make the fastest, best-performing processors for several years. A $9 billion deal isn’t going to fix all the problems of a $200 billion company. But every step toward a more focused Intel is a positive.(Updates throughout to reflect that Intel agreed to sell its memory business to SK Hynix.)This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Tae Kim is a Bloomberg Opinion columnist covering technology. He previously covered technology for Barron's, following an earlier career as an equity analyst.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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