Fourth quarter financials revealed that chipmaking giant Intel performed better than expected. The revenue report revealed an increase of 10% to $16.4 billion. Earnings per share were reported at 79 cents.
The numbers outperform the Wall Street estimates of quarterly revenue and EPS, $15.75 and 75 cents, respectively.
In a statement, Intel chief executive Brian Krzanich said, “The fourth quarter was a terrific finish to a record-setting and transformative year for Intel. In 2016, we took important steps to accelerate our strategy and refocus our resources while also launching exciting new products, successfully integrating Altera, and investing in growth opportunities.”
Intel also broke into the mobile market last year after years of failure. The Santa Clara-based company provided cellular modem chips for Apple’s iPhone 7. However, the deal did not have as great an impact on financials as expected. The company’s Client Computing Group had a revenue of $9.1 billion, a 4% year-over-year growth that included its PC and mobile businesses. Research firm IDC reports that the PC industry has been in decline for years, indicated by the 5.7% drop in sales last year.
In an attempt to distance itself from its reliance on PCs, Intel has moved toward the business of data centers. Its processors comprise 99% of the shares in the market. Intel’s Data Center Group grew 8% year-over-year to $4.7 billion in the fourth quarter.
Intel is still trying to catch up to greater computing demands for artificial intelligence in the data center. In August, the company acquired AI startup Nervana for over $400 million. The two-year-old startup was working on its own processor, optimized for AI use, Intel now plans to integrate this into its server products.
The company’s full-year revenue amounted to $59.4 billion, a 7% increase from the previous year. Net income was $10.3 billion, a 7% drop from 2015.
“I’m pleased with our 2016 performance and confident in our future,” said Krzanich in his statement.
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