Slide 1: 2nd Quarter Earnings Presentation
2nd Quarter Earnings Presentation Pat Gelsinger David Zinsner Chief Executive Officer Executive Vice President and Chief Financial Officer
Slide 2: Non-GAAP measures and forward-looking statements
• This presentation contains non-GAAP financial measures. Intel gross margin, and earnings per share, including year-over-year comparisons, are presented on a non-GAAP basis. This presentation also includes a non-GAAP adjusted free cash flow (FCF) measure. The Appendix provides a reconciliation of t
Slide 3: Q2 beat on Revenue, Gross Margin and EPS
Q2 beat on Revenue, Gross Margin and EPS Return to profitability; expecting modest 2H’23 recovery Effective execution across process and products is rebuilding customer confidence Executing to capture the insatiable demand for compute Positioned to democratize AI across the continuum of workloads an
Slide 4: Process and Manufacturing: 5 nodes in 4 years
Process and Manufacturing CCG DCAI NEX Meteor Lake PRQ in Q3’23 Emerald Rapids in Q4’23 bringing AI to the PC at scale Sierra Forest in 1H’24 followed Ericsson partnering on Industry Arrow Lake and Lunar Lake by Granite Rapids both on Intel 3 Scale Open RAN and next gen in 2024 Clearwater Forest on
Slide 5: Revenue, Gross Margin, EPS vs. outlook
Revenue Gross Margin EPS Down 15% YoY Down 5.0 ppts YoY Down 54% YoY $0.9B above April outlook1 2.3 ppt above April outlook1 $0.17 above April outlook1 1 Comparisons are based on the mid-point of revenue outlook 5
Slide 6: Revenue and Operating Income
Revenue down 12% Operating Income up 19% Revenue • Lower on overall TAM contraction and OEM inventory reductions $7.7B $6.8B Operating Income • Higher on reduced spending and inventory reserves Operating Operating Margin 15% Margin 11% $0.9B $1.0B Q2'22 Q2'23 Q2'22 Q2'23 6
Slide 7: Revenue and Operating Income
Revenue down 15% Operating Income down 101% Revenue • Lower on CPU TAM contraction and competitive pressure $4.7B $4.0B Operating Income • Lower on higher unit costs driven by factory utilization and product mix Operating Operating Margin (2%) Margin (4%) ($0.1B) ($0.2B) Q2'22 Q2'23 Q2'22 Q2'23 7
Slide 8: Revenue and Operating Income
Revenue down 38% Operating Income down 164% Revenue • Lower on edge and telco demand softness and elevated network inventories $2.2B Operating Income • Lower on reduced revenue $1.4B Operating Margin 13% $0.3B Operating Margin (14%) ($0.2B) Q2'22 Q2'23 Q2'22 Q2'23 8
Slide 9: Mobileye and Intel Foundry Services (IFS)
Mobileye Intel Foundry Services (IFS) Revenue Operating Income Revenue Operating Income Operating Margin 41% Operating $232M $460M $454M $190M Margin 28% $129M Operating Operating $57M Margin (235%) Margin (62%) ($134M) ($143M) Q2'22 Q2'23 Q2'22 Q2'23 Q2'22 Q2'23 Q2'22 Q2'23 • Revenue roughly flat Y
Slide 10: Outlook
Outlook intel. 10
Slide 11: Q3 Outlook: Revenue, Gross Margin, EPS
Revenue Gross Margin1 EPS1 Down 13% YoY Down 2.9 ppt YoY Down 46% YoY 1 Gross Margin and EPS outlook based on the mid-point of the revenue range 11
Slide 12: Appendix
Appendix
Slide 13: GAAP to non-GAAP gross margin and EPS reconciliation
Three Months Ended Jul 1, 2023 Jul 2, 2022 GAAP gross margin percentage 35.8% 36.5% Acquisition-related adjustments 2.4% 2.2% Share-based compensation 1.6% 1.2% Patent settlement -- 1.3% Optane inventory impairment -- 3.6% Non-GAAP gross margin percentage 39.8% 44.8% GAAP earnings (loss) per share a
Slide 14: Q3 2022 actuals and Q3 2023 outlook reconciliation
Q3 2022 Actuals Q3 2023 Outlook1 Approximately GAAP gross margin percentage 42.6% 39.1% Acquisition-related adjustments 2.2% 2.5% Share-based compensation 1.1% 1.4% Non-GAAP gross margin percentage 45.9% 43.0% GAAP earnings (loss) per share attributable to Intel—diluted $0.25 $0.04 Acquisition-relat
Slide 15: Talay
Talay