Intel is likely to report largely flat third-quarter results as worldwide chip shortages eat into potential sales and CEO Pat Gelsinger builds up the chip giant's manufacturing capacity.
The global chip shortage has forced automakers to shut down operations and raised costs on key products. Laptop manufacturers claim that shortages of some components have hampered shipments, leading backlogs to grow.
According to experts, Intel, which powers many personal computers, is projected to report $19.2 billion in third-quarter revenue on Thursday after the bell, approximately unchanged from the year-ago period, with a net income of $4.33 billion.
According to Morgan Stanley analysts, the chip giant's top line has been held back in part by a drop in PC shipments. "While we would argue that PC demand has remained fairly stable thus far," they stated, "supply constraints caused by other components (primarily power management chips) have slowed the overall business."
According to Susquehanna analyst Christopher Rolland, the time between a corporation ordering a chip and receiving it has increased to an average of 22 weeks, the longest since he began tracking the data in 2013.
Mr. Gelsinger announced last month that Intel will invest up to $95 billion in new chip production capacity in Europe, on top of the more than $20 billion in U.S. factory investments he detailed earlier, as the company tries to meet rising semiconductor demand and establish itself as a leading contract chipmaker. Taiwan semiconductor manufacture co., the world's largest contract chip producer, announced this month that it would build a new chip manufacturing factory in Japan, and Samsung electronics co. and memory chip maker micron technology. are among the companies that have announced expansion plans.