Thursday, April 24th 2025
Intel Reports First-Quarter 2025 Financial Results
Intel Corporation today reported first-quarter 2025 financial results. "The first quarter was a step in the right direction, but there are no quick fixes as we work to get back on a path to gaining market share and driving sustainable growth," said Lip-Bu Tan, Intel CEO. "I am taking swift actions to drive better execution and operational efficiency while empowering our engineers to create great products. We are going back to basics by listening to our customers and making the changes needed to build the new Intel."
"It was a solid start to the year as we executed well on our priorities," said David Zinsner, Intel CFO. "The current macro environment is creating elevated uncertainty across the industry, which is reflected in our outlook. We are taking a disciplined and prudent approach to support continued investment in our core products and foundry businesses while maximizing operational cost savings and capital efficiency."
Driving Greater Execution and Efficiency
Intel is taking actions to drive better, more efficient execution across the business. The plan includes streamlining the organization, eliminating management layers and enabling faster decision-making. In taking these actions, Intel will focus on empowering engineering talent to create great products and driving greater accountability across the company while making it easier for customers to do business with Intel.
In line with these actions, Intel is reducing its non-GAAP operating expense target to approximately $17 billion in 2025, down from its previously stated goal of $17.5 billion, and is now targeting $16 billion in 2026. Operating expenses include research and development (R&D), and marketing, general and administrative (MG&A). Intel expects to have restructuring charges associated with these actions, some of which may be included in its non-GAAP results. Since the company has not yet estimated these charges, they are not included in its guidance.
Additionally, further operational efficiencies and better utilization of construction-in-progress assets allow Intel to reduce its gross capital expenditures target to $18 billion for 2025, down from the company's previous target of $20 billion, while still expecting net capital expenditures of approximately $8 billion to $11 billion. Intel will continue to focus investment in its core business as it drives operational efficiency.
Business Unit Summary
In the first quarter of 2025, the company made an organizational change to integrate the Network and Edge Group (NEX) into CCG and DCAI and modified Intel's segment reporting to align to this and certain other business reorganizations. All prior-period segment data has been retrospectively adjusted to reflect the way Intel's chief operating decision maker internally receives information and manages and monitors the company's operating segment performance starting in fiscal year 2025. There are no changes to Intel's consolidated financial statements for any prior periods.
Business Highlights
"It was a solid start to the year as we executed well on our priorities," said David Zinsner, Intel CFO. "The current macro environment is creating elevated uncertainty across the industry, which is reflected in our outlook. We are taking a disciplined and prudent approach to support continued investment in our core products and foundry businesses while maximizing operational cost savings and capital efficiency."
Intel is taking actions to drive better, more efficient execution across the business. The plan includes streamlining the organization, eliminating management layers and enabling faster decision-making. In taking these actions, Intel will focus on empowering engineering talent to create great products and driving greater accountability across the company while making it easier for customers to do business with Intel.
In line with these actions, Intel is reducing its non-GAAP operating expense target to approximately $17 billion in 2025, down from its previously stated goal of $17.5 billion, and is now targeting $16 billion in 2026. Operating expenses include research and development (R&D), and marketing, general and administrative (MG&A). Intel expects to have restructuring charges associated with these actions, some of which may be included in its non-GAAP results. Since the company has not yet estimated these charges, they are not included in its guidance.
Additionally, further operational efficiencies and better utilization of construction-in-progress assets allow Intel to reduce its gross capital expenditures target to $18 billion for 2025, down from the company's previous target of $20 billion, while still expecting net capital expenditures of approximately $8 billion to $11 billion. Intel will continue to focus investment in its core business as it drives operational efficiency.
Business Unit Summary
In the first quarter of 2025, the company made an organizational change to integrate the Network and Edge Group (NEX) into CCG and DCAI and modified Intel's segment reporting to align to this and certain other business reorganizations. All prior-period segment data has been retrospectively adjusted to reflect the way Intel's chief operating decision maker internally receives information and manages and monitors the company's operating segment performance starting in fiscal year 2025. There are no changes to Intel's consolidated financial statements for any prior periods.
Business Highlights
- At CES, Intel announced the new Intel Core Ultra 200V series mobile processors with Intel vPro, Intel Core Ultra 200HX and H series mobile processors, Intel Core Ultra 200U series mobile processors, and an expanded Intel Core Ultra 200S series desktop processor portfolio.
- In February, Intel launched new Intel Xeon 6 processors with Performance-cores (P-cores) for data center and Xeon 6 processors for network and edge applications, providing enhanced performance and efficiency across workloads.
- In April, MLCommons released its latest MLPerf Inference v5.0 benchmarks, in which Intel Xeon 6 with P-cores demonstrated a 1.9x boost in AI performance over the previous generation of processors, affirming Intel Xeon 6 as a top solution for modern AI systems.
- Intel 18A is expected to ramp in the second half of 2025 to support the launch of Intel's first Panther Lake SKU by year-end, with additional SKUs coming in the first half of 2026.
- Earlier this month, Intel announced an agreement to sell 51% of its Altera business to Silver Lake. Intel will own the remaining 49% of the Altera business, enabling it to participate in Altera's future success while focusing on its core business.
- In March, Intel completed the second and final close of the sale of its NAND business to SK hynix.
5 Comments on Intel Reports First-Quarter 2025 Financial Results
Revenue is flat, that's good, it's not going down.
They also appear to have a negative tax rate.
I would like to have a negative tax rate too.
We need a competitive, healthy Intel, not a second Nvidia.
The competition between these companies (Intel, AMD and Nvidia) favors us consumers.
That logic, when supporting the stronger companies with stronger ties with OEMs and a stronger brand, leads to monopolies. We seen it in the past with Intel, we are seeing it today with Nvidia.
That logic when supporting AMD, it's simply dangerous and could again lead to monopolies and a weaker AMD. AMD needs to have better products and better prices on GPUs, to fight the monster Nvidia has become and needs to be much better than Intel in CPUs, because Intel with it's manufacturing can grab 10% of market share in a month, while AMD took them 5 years. OEMs will jump ALL on Intel if Intel can start making competitive CPUs in it's fabs. We will have a repeat of what the first Core did 20 years ago and what 12th gen Core did 4 years ago. Also we need AMD to keep selling with healthy profit margins. We might not like it, but Nvidia makes 30 billions per quarter with profit margins over 75% and Intel making good CPUs in it's fabs will mean over 15 billions per quarter with profit margins at over 60%. AMD can't fight those two if it starts selling at lower prices. They don't make the gazillions Nvidia does, they don't have fabs to build CPUs and sell at the profit margins Intel can. AMD pays TSMC and TSMC has become a very expensive option. AMD becoming one of the first customers of TSMC's 2nm means they have invested a huge sum of money because they fear Intel's 18A. The future Ryzen build on TSMC's 2nm, aren't going to be cheap and they aren't going to put high prices on those because of greed. TSMC is really expensive. If they are forced to lower prices, by 2030 we will be back to a situation where Intel and Nvidia will be monopolies and AMD fighting for survival.
The reason we see near monopolies is consolidation.
We had a ton of GPU makers 20+ years ago. S3, Matrox, Nvidia, ATI, 3dfx, 3dLabs, Trident, Cirrus.
Most of these ultimately consolidated under Nvidia, AMD, and to a lesser degree Apple and Intel.
The profit margins on a GPU chip now are absolutely ridiculous, Nvidia for example has > 50% margin. Supply is obviously constrained on purpose. Both AMD and Nvidia want to keep margins high, maximum profit for minimum effort. Neither has an incentive to rock that boat.
The result is that mainstream users have moved away from gaming PCs. You can see it here in these forums, where a $400 GPU is poverty level. Laptops probably represent what's left of mainstream, but few of those people are here. Nature of the beast, a laptop is what it is so they won't upgrade every 2 years, more like 5-7.
Meanwhile consoles rule the gaming arena to the degree that most AAA PC titles are nothing more than a console port. And why wouldn't they? I mean a PS5 is $400-$500.