Intel Reports Fourth-Quarter and Full-Year 2020 Financial Results
SANTA CLARA, Calif., Jan. 21, 2021 -- Intel Corporation today reported fourth-quarter and full-year 2020 financial results. The company also announced that its board of directors approved a cash dividend increase of five percent to $1.39 per share on an annual basis. The board declared a quarterly dividend of $0.3475 per share on the company’s common stock, which will be payable on March 1 to shareholders of record on February 7.
News Summary
- Fourth-quarter revenue was $20.0 billion, exceeding October guidance by $2.6 billion and down 1 percent year-over-year (YoY). Full-year revenue set an all-time Intel record of $77.9 billion, up 8 percent YoY.
- Delivered outstanding fourth-quarter earnings per share (EPS) of $1.42 ($1.52 on a non-GAAP basis, exceeding October guidance by 42 cents).
- In 2020, Intel generated a record $35.4 billion cash from operations and $21.1 billion of free cash flow (FCF) and returned $19.8 billion to shareholders.
- Forecasting first-quarter 2021 revenue of approximately $18.6 billion (non-GAAP revenue of $17.5 billion); expecting first-quarter EPS of $1.03 (non-GAAP EPS of $1.10).1
“We significantly exceeded our expectations for the quarter, capping off our fifth consecutive record year,” said Bob Swan, Intel CEO. “Demand for the computing performance Intel delivers remains very strong and our focus on growth opportunities is paying off. It has been an honor to lead this wonderful company, and I am proud of what we have achieved as a team. Intel is in a strong strategic and financial position as we make this leadership transition and take Intel to the next level.”
Q4 2020 Financial Highlights
| GAAP | Non-GAAP | ||||||
| Q4 2020 | Q4 2019 | vs. Q4 2019 | Q4 2020 | Q4 2019 | vs. Q4 2019 | ||
| Revenue ($B) | $20.0 | $20.2 | down 1% | $20.0^ | $20.2^ | down 1% | |
| Gross margin | 56.8% | 58.8% | down 2.0 ppt | 58.4% | 60.1% | down 1.7 ppt | |
| R&D and MG&A ($B) | $5.4 | $5.0 | up 9% | $5.4 | $4.9 | up 9% | |
| Operating margin | 29.5% | 33.6% | down 4.2 ppt | 31.5% | 35.7% | down 4.2 ppt | |
| Tax rate | 21.8% | 14.4% | up 7.4 ppt | 21.5% | 13.6% | up 7.9 ppt | |
| Net income ($B) | $5.9 | $6.9 | down 15% | $6.2 | $6.7 | down 6% | |
| Earnings per share | $1.42 | $1.58 | down 10% | $1.52 | $1.52 | flat | |
In the fourth quarter, the company generated $9.9 billion in cash from operations and paid dividends of $1.4 billion.
Full-Year 2020 Financial Highlights
| GAAP | Non-GAAP | ||||||
| 2020 | 2019 | vs. 2019 | 2020 | 2019 | vs. 2019 | ||
| Revenue ($B) | $77.9 | $72.0 | up 8% | $77.9^ | $72.0^ | up 8% | |
| Gross margin | 56.0% | 58.6% | down 2.5 ppt | 57.6% | 60.1% | down 2.6 ppt | |
| R&D and MG&A ($B) | $19.7 | $19.7 | flat | $19.5 | $19.5 | flat | |
| Operating margin | 30.4% | 30.6% | down 0.2 ppt | 32.5% | 33.0% | down 0.5 ppt | |
| Tax rate | 16.7% | 12.5% | up 4.2 ppt | 16.4% | 12.2% | up 4.2 ppt | |
| Net income ($B) | $20.9 | $21.0 | down 1% | $22.4 | $21.8 | up 3% | |
| Earnings per share | $4.94 | $4.71 | up 5% | $5.30 | $4.87 | up 9% | |
| Cash from Operations | $35.4 | $33.1 | up 7% | $35.4^ | $33.1^ | up 7% | |
| Free cash flow | N/A | N/A | N/A | $21.1 | $16.9 | up 25% | |
For the full year, the company generated a record $35.4 billion cash from operations, paid dividends of $5.6 billion, and used $14.2 billion to repurchase 274.6 million shares of stock.
Business Unit Summary
| Key Business Unit Revenue and Trends | Q4 2020 | vs. Q4 2019 | 2020 | vs. 2019 | ||||||
| Data-centric: | ||||||||||
| DCG | $6.1 billion | down | 16% | $26.1 billion | up | 11% | ||||
| Internet of Things | ||||||||||
| IOTG | $777 million | down | 16% | $3.0 billion | down | 21% | ||||
| Mobileye | $333 million | up | 39% | $967 million | up | 10% | ||||
| NSG | $1.2 billion | down | 1% | $5.4 billion | up | 23% | ||||
| PSG | $422 million | down | 16% | $1.9 billion | down | 7% | ||||
| down | 11%* | up | 9%* | |||||||
| PC-centric: | ||||||||||
| CCG | $10.9 billion | up | 9% | $40.1 billion | up | 8% | ||||
Fourth-quarter revenue exceeded prior expectations by $2.6 billion driven by record PC-centric revenue with PC unit volumes up 33 percent YoY led by record notebook sales. The company also achieved better-than-expected data-centric results, including record Mobileye revenue.
2020 marked Intel's fifth consecutive year of record revenue. The Client Computing Group, Data Center Group, Non-volatile Memory Solutions Group, and Mobileye all achieved record full-year revenue. In 2020, the company invested $13.6 billion in research and development and $14.3 billion in capital expenditures while focusing to strengthen its core CPU business, improve execution and accelerate growth.
Q4'20 Business Highlights
- Started production of 10nm-based 3rd Gen Intel® Xeon® Scalable processors (“Ice Lake”), ramping in Q1.
- Launched 11th Gen Intel® Core™ processors ("Tiger Lake"); announced 11th Gen Intel® Core™ S-Series desktop processors ("Rocket Lake"), now shipping.
- Entered discrete graphics market with Intel® Iris® Xe MAX graphics, Intel’s first Xe-based discrete GPU.
- Announced Amazon Web Services selected Intel's Habana Gaudi AI processors for EC2 training.
- Delivered gold release of Intel® oneAPI developer toolkit.
- Announced expanded network infrastructure solutions portfolio.
- Introduced new Intel® Optane™ SSD series and 3rd gen Intel Optane persistent memory “Crow Pass” for enterprise and cloud customers.
Additional information regarding Intel’s results can be found in the Q4'20 Earnings Presentation available at: www.intc.com.
Business Outlook
Intel's guidance for the first quarter includes both GAAP and non-GAAP estimates. Our Non-GAAP measures exclude the NAND memory business, which is subject to a previously-announced pending sale. Reconciliations between GAAP and non-GAAP financial measures are included below.
| Q1 2021 | GAAP | Non-GAAP | ||
| Approximately | Approximately | |||
| Revenue | $18.6 billion | $17.5 billion | ||
| Operating margin | 27% | 30% | ||
| Tax rate | 14.5% | 14.5%^ | ||
| Earnings per share | $1.03 | $1.10 |
Actual results may differ materially from Intel’s Business Outlook as a result of, among other things, the factors described under “Forward-Looking Statements” below.
Earnings Webcast
Intel will hold a public webcast at 2:00 p.m. PDT today to discuss the results for its fourth quarter of 2020. The live public webcast can be accessed on Intel's Investor Relations website at www.intc.com. Intel Chairman, Omar Ishrak and incoming CEO, Pat Gelsinger will join Intel CEO, Bob Swan and Intel CFO, George Davis on today's call. The Q4'20 Earnings Presentation, webcast replay, and audio download will also be available on the site.
Intel plans to report its earnings for the first quarter of 2021 on April 22, 2021 promptly after close of market, and related materials will be available at www.intc.com. A public webcast of Intel’s earnings conference call will follow at 2:00 p.m. PDT at www.intc.com.
Detailed information regarding these and other factors that could affect Intel's business and results is included in Intel's SEC filings, including the company's most recent reports on Forms 10-K and 10-Q, particularly the "Risk Factors" sections of those reports. Copies of these filings may be obtained by visiting our Investor Relations website at www.intc.com or the SEC's website at www.sec.gov.
About Intel
Intel (Nasdaq: INTC) is an industry leader, creating world-changing technology that enables global progress and enriches lives. Inspired by Moore’s Law, we continuously work to advance the design and manufacturing of semiconductors to help address our customers’ greatest challenges. By embedding intelligence in the cloud, network, edge and every kind of computing device, we unleash the potential of data to transform business and society for the better. To learn more about Intel’s innovations, go to newsroom.intel.com and intel.com.
Link to earnings release: https://www.intc.com/news-events/press-releases/detail/1439/intel-reports-fourth-quarter-and-full-year-2020-financial
Source: Intel Corp.
