Intel's (INTC) - Get Intel Corporation Report third-quarter financial results met analyst expectations and it raised its full-year guidance, but the chipmaking giant said it saw weakness in its data-centric businesses serving governments and enterprises.
After the market closed on Thursday, the Santa Clara, Calif., company reported non-GAAP earnings of $1.11 a share on revenue of $18.3 billion.
The company had been expected to report adjusted net income of $4.7 billion, or $1.11 a share, on sales of $18.2 billion, based on a FactSet survey of 37 analysts.
In the year-earlier period the company earned $1.42 a share on sales of $19.2 billion. It reported net income of $4.2 billion.
Intel said it had seen weakness in its data-centric businesses serving government and large enterprises.
"A weaker economy due to covid-19 impacted DCG's enterprise and government market segment, which was down 47% year over year following two quarters of more than 30% growth," the company said.
"The pandemic also weighed on third-quarter data-centric results in the internet of things group and the memory business."
Intel shares at last check fell 9.8% to $48.61.
In the current quarter analysts are forecasting adjusted net income of $1.07 a share on sales of $17.4 billion. Intel forecast non-GAAP earnings per share for the fourth quarter of $1.10 on revenue of $17.4 billion.
For the full year, Intel projected revenue of $75.3 billion. Analysts are currently projecting revenue of $75.2 billion.
Chip companies in general have been benefiting from increased sales of laptops and other devices to consumers who've been forced to work at home because of the coronavirus pandemic.
Intel said that held true in the just-completed quarter as "continued strength in notebook sales ... helped offset covid-driven headwinds affecting significant portions of our business."
Increased demand for cloud-computing services has also been driving hardware demand for the chips needed to run data servers.
But Intel shares have been hurt by delays in launching its latest generation of chips because of manufacturing issues. Those problems have given an opening to perennial rival Advanced Micro Devices (AMD) - Get Advanced Micro Devices Inc. Report.
In August, Intel announced plans to accelerate the repurchase of up to $10 billion of its stock in a bid to appease shareholders and take advantage of the stock's weakness.
Earlier this week, Intel reached an agreement to sell its NAND memory chip business to South Korea's SK Hynix for about $9 billion.