Semiconductor giant Intel has given a look at the effect that the coronavirus pandemic may have on its business in the coming months. And that view is nothing but uncertain.
Intel said as much with its first-quarter report, in which the the world’s largest chipmaker said late Thursday that because of the “significant economic uncertainty” brought on by the coronavirus crisis, it was withdrawing its sales forecast for all of 2020. Intel gave a bleak assessment of the impact coronavirus is likely to have on both its own operations, and the overall economy.
“It is likely that the current outbreak and continued spread of COVID-19 will cause an economic slowdown, and it is possible that it could cause a global recession,” Intel said in a statement about its business results and outlook. “It is difficult to predict the nature and extent of (coronovirus-related) impacts on demand for our products.”
Intel said that during the first three months of the year, it earned $1.45 a share, excluding one-time items, on revenue of $19.8 billion. Those results topped Wall Street analysts forecasts for a profit of $1.28 a share on revenue of $18.67 billion. Intel said it’s business benefited from companies and consumers making computer purchases and upgrades to better-enable working from home.
Intel also said that for its second quarter, which ends in June, it anticipates earning $1.10 a share, on $18.5 billion in revenue. However, that earnings outlook fell short of analysts’ estimates, and added to concerns about Intel’s business being affected by the coronavirus’ impact on the economy.
Reaction to Intel’s outlook was tepid Friday, with the company’s shares down by 0.9%, at $58.51.
Along with Intel, much of the U.S. stock market put in a rare mild trading performance in the wake of several days of triple-digit gains and losses. The Dow Jones Industrial Average was down by just 0.1%, at 23,486.24, while the S&P 500 edged just above its breakeven point, to 2,799.76, and the Nasdaq Composite Index was up by 0.3%, at 2,799.76.
Among notable Bay Area companies, Apple shares were up by 1.6%, at $279.49, Tesla was up by 1%, at $712.62 a share, Facebook was off by 0.2%, at $184.85 a share, Cisco Systems shares rose 1%, to $41.99 and HP rose 1.7%, to $14.87 a share.
