Slide 1: Investor Meeting 2012
INVESTOR MEETING 2012 Exhibit 99.1
Slide 2: Stacy Smith, Senior Vice President, Chief Financial Officer
Stacy Smith Senior Vice President Chief Financial Officer INVESTOR MEETING 2012
Slide 3: What You Heard Today
INVESTOR MEETING 2012 3 What You Heard Today • We are well positioned to power the next decade of computing – Reinventing the PC with the Ultrabook TM – Capitalizing on Data Center & Internet Growth – Bringing the best of Intel technologies to phones & tablets – Delivering leading hardware plus soft
Slide 4: What You Will Hear From Me
INVESTOR MEETING 2012 4 What You Will Hear From Me • Our process technology and manufacturing leadership is a more valuable competitive advantage than ever before • Our investments are delivering leadership products across all segments, which in turn is allowing us to generate outstanding revenue an
Slide 5: Growth and Shareholder Return
INVESTOR MEETING 2012 5 Growth and Shareholder Return
Slide 6: Moore's Law
INVESTOR MEETING 2012 6 Moore’s Law “The number of transistors per square inch of silicon doubles every 2 years” Two Implications: 1. Cost per square inch goes up over time 2. Doubling of transistors = “Scaling” – Improves performance – Cost per transistor declines
Slide 7: Capex Investment Operating Guidelines
INVESTOR MEETING 2012 7 Capex Investment Operating Guidelines 1. Advancing process technology lowers costs 2. Faster is better 3. Capacity deployed for expected unit volume 4. Protect ability to capture upsides in demand
Slide 8: Capex Investment Operating Guidelines: All Still True
INVESTOR MEETING 2012 8 Capex Investment Operating Guidelines 1. Advancing process technology lowers costs 2. Faster is better 3. Capacity deployed for expected unit volume 4. Protect ability to capture upsides in demand All Still True … 2 Observations • Our leadership is extending as complexity and
Slide 9: Unit Volume Is Increasing
INVESTOR MEETING 2012 9 Unit Volume Is Increasing 45 nm 32 nm 22 nm Forecast Microprocessor Unit Shipments by Process Node 65 nm Source: Intel
Slide 10: Feature Integration Adds Value For Customers
INVESTOR MEETING 2012 10 Feature Integration Adds Value For Customers Client Core Mix % CPUs Sold with Integrated Graphics and Chipset Functionality 2009 2010 2011 2009 2010 2011 Source: Intel
Slide 11: Complexity is Increasing
INVESTOR MEETING 2012 11 45 nm 32 nm 22 nm 14 nm Forecast 65 nm Complexity is Increasing Square Feet per Wafer Will Be Higher Sources: Intel Forecast is based on current expectations and is subject to change without notice Square Feet per Wafer
Slide 12: Putting in Significant New Space
INVESTOR MEETING 2012 12 Putting in Significant New Space Capex Investment $Billion Sources: Intel Forecast is based on current expectations and is subject to change without notice Forecast
Slide 13: Platform Forecast
INVESTOR MEETING 2012 13 mm 2 Forecast Sources: Intel Forecast is based on current expectations and is subject to change without notice *Platform includes CPU and chipset and excludes Atom
Slide 14: And We are Getting Paid for Our Technology Leadership
INVESTOR MEETING 2012 14 *Platform includes both CPU and chipset and excludes Atom And We are Getting Paid for Our Technology Leadership 2006 2007 2008 2009 2010 2011 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 $Billions $
Slide 15: Deploying Capacity for Long Term Growth
INVESTOR MEETING 2012 15 Utilization rates Deploying capacity for long term growth 0 2000 2003 2005 2004 2007 2006 2001 2002 1997 2008 1998 1999 2009 2010 Forecast 2011 Logic Capacity Wafer Starts per Week 300mm Equivalent 2012 Sources: Intel Forecast is based on current expectations and is subject
Slide 16: Our Business Has Grown Significantly
INVESTOR MEETING 2012 16 Our Business Has Grown Significantly Capex Investment $Billion Revenue $Billion Sources: Intel *Represents the midpoint of our capex guidance of $12.5B **Not an Intel forecast. Represents consensus revenue estimates from First Call on 5/4/12
Slide 17: Depreciation in Line with Historical Levels
INVESTOR MEETING 2012 17 Depreciation in Line with Historical Levels Depreciation as a % of Revenues % Forecast Depreciation as a % of Cost of Sales Forecast % Sources: Intel Forecast is based on current expectations and is subject to change without notice Depreciation as a % of Revenues % Depreciat
Slide 18: Delivering Historically High Gross Margins
INVESTOR MEETING 2012 18 Delivering Historically High Gross Margins Forecast 64% in 2012 represents the midpoint of the 2012 full year outlook range Forecast range is based on current expectations and is subject to change without notice Source: Intel 55%-65% Gross Margin Range
Slide 19: Hold on there Tex
INVESTOR MEETING 2012 19 Hold on there Tex … So why isn’t this increase in capital dollars per wafer impacting gross margin?
Slide 20: Our Cost Equation Changes vs. Historical Trend
INVESTOR MEETING 2012 20 Our Cost Equation Changes vs. Historical Trend Historical cost per transistor decline continues + =
Slide 21: Transistor Innovations Enable Cost Benefits of Moore's Law to Continue
INVESTOR MEETING 2012 21 $ / Transistor (Relative to 0.35um) 0.001 0.01 0.1 1 .35um .25um .18um .13um 90nm 65nm 45nm 32nm 22nm 14nm 10nm 200mm 300mm Forecast Transistor Innovations Enable Cost Benefits of Moore’s Law to Continue Source: Intel Forecast is based on current expectations and is subject
Slide 22: Hold on there Tex: what if we are wrong about unit growth?
INVESTOR MEETING 2012 22 Hold on there Tex … what if we are wrong about unit growth?
Slide 23: Responsiveness - Case Study 2008 Financial Crisis
INVESTOR MEETING 2012 23 Responsiveness - Case Study 2008 Financial Crisis $Billion Revenue Source: Intel
Slide 24: Responsiveness - Case Study 2008 Financial Crisis
INVESTOR MEETING 2012 24 Responsiveness - Case Study 2008 Financial Crisis 96% 34% 91% 0% 20% 40% 60% 80% 100% Q2'08 Q4'08 Q2'09 Q4'09 Q2'10 Source: Intel
Slide 25: Responsiveness - Case Study 2008 Financial Crisis
INVESTOR MEETING 2012 25 Responsiveness - Case Study 2008 Financial Crisis $Billion $1.2 $0.9 $1.0 0 1 2 Q2'08 Q4'08 Q2'09 Q4'09 Q2'10 CapEx $2.0 Source: Intel
Slide 26: Responsiveness - Case Study 2008 Financial Crisis
INVESTOR MEETING 2012 26 Responsiveness - Case Study 2008 Financial Crisis Gross Margin 55% 45% 67% Q2'08 Q4'08 Q2'09 Q4'09 Q2'10 0% 20% 40% 60% 80% 100% Source: Intel
Slide 27: Growth and Shareholder Return
INVESTOR MEETING 2012 27 Growth and Shareholder Return
Slide 28: Strong Businesses Across the Continuum
INVESTOR MEETING 2012 28 Strong Businesses Across the Continuum PC Client Group 2011 Rev/OM $35.4B/$14.8B Software and Services Group 2011 Rev/OM $1.9B/Breakeven Source: Intel Data Center Group Other Intel Arch. 2011 Rev/OM $5.0B/($0.6B) 2011 Rev/OM $10.1B/$5.1B
Slide 29: Strong Businesses Across the Continuum
INVESTOR MEETING 2012 29 Strong Businesses Across the Continuum PC Client Group 2011 Rev/OM $35.4B/$14.8B Software and Services Group 2011 Rev/OM $1.9B/Breakeven Data Center Group Other Intel Arch. 2011 Rev/OM $5.0B/($0.6B) 2011 Rev/OM $10.1B/$5.1B Source: Intel
Slide 30: PC Client Group 2010 vs. 2011
INVESTOR MEETING 2012 30 PC Client Group 2010 vs. 2011 2011 PERFORMANCE $35.4B of revenue: 17% revenue growth • High single digit unit growth • Richer mix of products $ 14.8B of operating margin: 42% of revenue • Unit cost down in the Performance and Mainstream segments • Increased investment in Ult
Slide 31: Segmented Costs to Compete Across Segments
INVESTOR MEETING 2012 31 Segmented Costs to Compete Across Segments Platform Costs* Performance Mainstream Value Atom™ * Platform includes both CPU and Chipset components Forecast is based on current expectations and is subject to change without notice Source: Intel Forecast Forecast Forecast Foreca
Slide 32: PC Client Group Looking Forward to 2013
INVESTOR MEETING 2012 32 PC Client Group Looking Forward to 2013 Expect Emerging Markets and Ultrabooks™ will drive solid revenue growth Technology leadership, cost improvements, and segmentation expected to maintain the operating margin % Forward looking statements specified are preliminary based o
Slide 33: Data Center Group: Strong Businesses Across the Continuum
INVESTOR MEETING 2012 33 Data Center Group Strong Businesses Across the Continuum PC Client Group Other Intel Arch. 2011 Rev/OM $5.0B/($0.6B) 2011 Rev/OM $35.4B/$14.8B Software and Services Group 2011 Rev/OM $1.9B/Breakeven Source: Intel 2011 Rev/OM $10.1B/$5.1B
Slide 34: Data Center Group 2010 vs. 2011
INVESTOR MEETING 2012 34 Data Center Group 2010 vs. 2011 Source: Intel 2011 Performance $10.1 B of Revenue: 17% growth • Double digit server unit growth • Richer mix of products driving higher ASPs • Significant growth in networking and storage $5.1 B of Operating income: 50% of Revenues $Billion
Slide 35: Data Center Group Looking Forward
INVESTOR MEETING 2012 35 Data Center Group Looking Forward Benefiting from four trends 1. Build-out of the cloud 2. Expanding into networking and communications infrastructure, fabric, and storage 3. Voracious demand for high-performance computing 4. Technology leadership = high ROI for enterprise e
Slide 36: Strong Businesses Across the Continuum
INVESTOR MEETING 2012 36 Data Center Group Strong Businesses Across the Continuum PC Client Group Other Intel Arch. 2011 Rev/OM $5.0B/($0.6B) 2011 Rev/OM $35.4B/$14.8B Software and Services Group 2011 Rev/OM $1.9B/Breakeven Source: Intel 2011 Rev/OM $10.1B/$5.1B
Slide 37: Already a Large Player, We Expect To Outgrow The Market
INVESTOR MEETING 2012 37 Already a Large Player, We Expect To Outgrow The Market Forecast Forecast $Billion Source: Intel Forecast is based on current expectations and is subject to change without notice
Slide 38: Making Significant Investments
INVESTOR MEETING 2012 38 Making Significant Investments Forecast $Billion Sources: Intel Forecast is based on current expectations and is subject to change without notice
Slide 39: Significant R&D Investment Leverage
INVESTOR MEETING 2012 39 Significant R&D Investment Leverage Technology Development >$2B Software R&D >$1B Shared Processor and Gfx >$2B FOUNDATIONAL INVESTMENT Sources: Intel Forecast is based on current expectations and is subject to change without notice
Slide 40: R&D Synergies Across Businesses
INVESTOR MEETING 2012 40 R&D Synergies Across Businesses $2B Other IA (Phones, Tablets, Embedded, IMC) $2B PCCG + DCG Development >$2B R&D >$1B and Gfx >$2B FOUNDATIONAL INVESTMENT Sources: Intel Forecast is based on current expectations and is subject to change without notice
Slide 41: Intel Atom Extends the Cost Curve
INVESTOR MEETING 2012 41 Intel Atom™ Extends the Cost Curve 1x .5x .25x Sources: Intel Forecast is based on current expectations and is subject to change without notice High-End Smartphone Segment Low-End Smartphone Segment
Slide 42: Other Intel Architecture Group Looking Forward
INVESTOR MEETING 2012 42 Other Intel Architecture Group Looking Forward Intelligent Systems • On track to be a $2B business in 2012 • Expect revenue growth of 25%+ in 2013 with operating margin of ~$1B Phones and Tablets • Making significant investments in SOC capabilities, LTE, and Software • 2012
Slide 43: Strong Businesses Across the Continuum
INVESTOR MEETING 2012 43 Data Center Group Strong Businesses Across the Continuum PC Client Group Other Intel Arch. 2011 Rev/OM $5.0B/($0.6B) 2011 Rev/OM $35.4B/$14.8B Software and Services Group 2011 Rev/OM $1.9B/Breakeven Source: Intel 2011 Rev/OM $10.1B/$5.1B
Slide 44: Software and Services Group
INVESTOR MEETING 2012 44 Software and Services Group • Rapidly growing software and services capabilities • Expertise in security benefiting our core business • 2011: $1.9B in revenue/~breakeven • 2012: ~$2.4B* in revenue /slightly positive operating margin • 2013 and beyond*: Expect low double digi
Slide 45: NAND Solutions Group
INVESTOR MEETING 2012 45 NAND Solutions Group* $0 Sources: Operating Profit $ and Compute % - Intel Cost/GB - iSuppli - Flash Q1 2012 Market Tracker Forecast is based on current expectations and is subject to change without notice *NAND solutions group is the same as Non-Volatile Memory Solutions Gr
Slide 46: Delivering Historically High Gross Margins
INVESTOR MEETING 2012 46 Delivering Historically High Gross Margins Forecast 64% in 2012 represents the midpoint of the 2012 full year outlook range Forecast range is based on current expectations and is subject to change without notice Source: Intel 2013 Top End of the Range
Slide 47: Growth and Shareholder Return
INVESTOR MEETING 2012 47 Growth and Shareholder Return
Slide 48: Delivering Significant Growth
INVESTOR MEETING 2012 48 Delivering Significant Growth 2008-2011: 37% CAGR Source: Intel *2009 earnings per share excludes EC fine and AMD settlement of $2.6B. See Non-GAAP recon in Appendix A 2008-2011: 13% CAGR $Billion
Slide 49: ROIC Progress Report
INVESTOR MEETING 2012 49 ROIC Progress Report ROIC includes cash and goodwill. 2001-2005 excludes share-based compensation. GAAP required the recognition of share- based compensation beginning in 2006. See Appendix B for the calculation of Intel ROIC and the related reconciliations of GAAP to non-GA
Slide 50: Strong Cash Generation: Cash from Operations
INVESTOR MEETING 2012 50 Strong Cash Generation Cash from Operations $Billion Source: Intel
Slide 51: Strong Cash Generation
INVESTOR MEETING 2012 51 Strong Cash Generation $Billion Sources: Intel
Slide 52: Steadily Increasing Dividend
INVESTOR MEETING 2012 52 Steadily Increasing Dividend *2012 Annualized figure for dividend is not an Intel forecast but represents the Q1 payment, plus the Q2 declaration, plus the May 7 th announced Q3 dividend, and assuming the fourth quarter is equal to the third quarter Source: Intel 2003-2012:
Slide 53: Share Repurchases
INVESTOR MEETING 2012 53 Share Repurchases In 2011, we bought back 642 million shares for $14.1B Source: Intel
Slide 54: Key Messages
INVESTOR MEETING 2012 54 Key Messages • Our process technology and manufacturing leadership is a more valuable competitive advantage than ever before • Our investments are delivering leadership products across all segments, which in turn is allowing us to generate outstanding revenue and profit grow
Slide 55: Risk Factors
INVESTOR MEETING 2012 55 Risk Factors The above statements and any others in this document that refer to plans and expectations for the second quarter, the year and the future are forward-looking statements that involve a number of risks and uncertainties. Words such as “anticipates,” “expects,” “in
Slide 56: Reconciliations of GAAP to Non-GAAP Results: Appendix A
INVESTOR MEETING 2012 56 INTEL CORPORATION RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS Appendix A: AMD Settlement/EC Fine • In addition to disclosing financial results calculated in accordance with United States (U.S.) generally accepted accounting principles (GAAP), this presentation contains non-G
Slide 57: Appendix A: AMD Settlement/EC Fine (Continued)
INVESTOR MEETING 2012 57 INTEL CORPORATION RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS Appendix A: AMD Settlement/EC Fine (Continued)
Slide 58: Appendix B: Historic ROIC
INVESTOR MEETING 2012 58 INTEL CORPORATION RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS Appendix B: Historic ROIC • We define Return on Invested Capital (ROIC) as adjusted net operating profit after taxes divided by beginning invested capital. Management believes that ROIC provides greater visibility
Slide 59: Appendix B: Historic ROIC
INVESTOR MEETING 2012 59 INTEL CORPORATION RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS Appendix B: Historic ROIC ($m) 2002 2003 2004 2005 2006 Net income (GAAP) $ 3,117 $ 5,641 $ 7,516 $ 8,664 $ 5,044 Interest expense 84 62 50 19 24 Income tax adjustment (1) (22) (15) (14) (6) (7) Adjusted net opera
Slide 60: Appendix B: Historic ROIC (Continued)
INVESTOR MEETING 2012 60 INTEL CORPORATION RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS Appendix B: Historic ROIC (Continued) ($m) 2007 2008 2009 2010 2011 Net income (GAAP) $ 6,976 $ 5,292 $ 4,369 $ 11,464 $ 12,942 Interest expense 15 8 1 0 41 Income tax adjustment (1) (4) (2) (0) 0 (11) Adjusted ne
Slide 61: Calculation of Forecast ROIC, Appendix C
INVESTOR MEETING 2012 61 INTEL CORPORATION CALCULATION OF FORECAST ROIC Appendix C ($m) 2012 Forecast Consensus net income (1) $ 12,696 Annualized interest expense (2) 124 Income tax adjustment (3) (35) Adjusted net operating profit after taxes $ 12,785 2011 Total assets (GAAP) $ 71,119 Current liab
Slide 62: INVESTOR MEETING 2012
INVESTOR MEETING 2012