Huan Qiu Wang·2025-07-25 02:24Core Viewpoint - Intel reported its Q2 earnings, exceeding revenue expectations but announced significant strategic adjustments under new CEO Pat Gelsinger, leading to a 5% drop in stock price after hours [1]. Financial Performance - Intel's Q2 revenue reached $12.86 billion, surpassing the expected $11.92 billion, but reported a net loss of $2.9 billion, equating to a loss of $0.67 per share, compared to a net loss of $1.61 billion or $0.38 per share in the same quarter last year [3]. - The adjusted loss per share was $0.10, with an $800 million impairment charge affecting earnings expectations by approximately $0.20 [3]. - For Q3, Intel forecasts revenue of $13.1 billion, slightly above the analyst average expectation of $12.65 billion, and anticipates breakeven earnings, while analysts expect a profit of $0.04 per share [3]. Strategic Adjustments - CEO Pat Gelsinger announced a significant reduction in workforce, with 15% of employees affected, aiming to reduce operational costs by $17 billion by 2025 [3][4]. - Intel is focusing on its costly foundry business, which generated $4.4 billion in revenue but incurred an operating loss of $3.17 billion, leading to the cancellation of planned wafer fabrication plants in Germany and Poland [4]. - The company will slow down the construction of a cutting-edge chip factory in Ohio, contingent on market demand and securing major clients [4]. Business Segment Performance - The Client Computing Group, responsible for PC processors, reported Q2 sales of $7.9 billion, a 3% year-over-year decline [4]. - The Data Center Group saw a 4% revenue increase to $3.9 billion, which includes some AI chips but primarily focuses on server processors [4]. - Intel aims to regain market share in the data center chip sector, facing increasing competition from AMD [4]. Leadership and Oversight - Gelsinger will personally review and approve all chip designs before production to enhance control over the design process [5]. - Despite a 13% increase in stock price this year, Intel's stock has plummeted 60% in 2024, marking its worst performance on record [5].