Sales in the division responsible for server chips and other data-center gear rose 24%, notching important growth in the highly profitable segment. Intel is leaning on the unit, which typically makes up around one-third of its revenue, as sales of personal computers give way to mobile devices and smart speakers. Sales of data-center equipment to cloud providers grew 45% from a year earlier, while sales to network operators were up more than 30%. Enterprise sales edged up 3%, the company said. Executives on its conference call attributed that growth to corporate spending to keep proprietary data on-site rather than in the cloud.
CSCO -1.29 % said it would shed 5,500 employees--7% of its workforce--in the networking company's latest reaction to a shift in its core market from hardware to software. The planned reduction renews a pattern of midsummer moves to reduce costs and make room to hire employees with new talents. Cisco's announcement along with its fourth-fiscal quarter earnings marks the most dramatic response yet to market changes by Chief Executive Chuck Robbins, who a year ago assumed the position held for two decades by John Chambers, who remains chairman. The company said it expects to reinvest all of its cost savings from the job cuts into what it called "key priority areas." The layoffs will begin in the current quarter.
Chip giant Intel this afternoon reported Q4 revenue and profit that blew away expectations, and forecast revenue and profit this quarter much higher than expected as well. It was the last quarter for CEO Bob Swan as he passes the baton to Intel alum Pat Gelsinger, who will take over next month, leaving his role as head of VMware. The release came out five minutes before the close of U.S. markets, and Intel shares surged nearly 7% into the close. The stock, however, declined by 1% in late trading. Management will host a conference call with analysts at 5 pm, Eastern time, and you can catch it on the company's investor relations Web site.
Intel Corp. INTC 2.48 % on Friday raised its revenue forecast for the third quarter amid signs of improving demand in the personal-computer market. The chip maker said it now expects third-quarter revenue of 15.6 billion, plus or minus 300 million, up from a previous range of 14.9 billion, plus or minus 500 million. Intel said the guidance increase comes as inventory in the PC supply chain needed to be replenished, and that the company had seen "some signs of improving PC demand." Intel shares, up 6% this year, added another 3.8% premarket to 37.96. When reporting its second-quarter's results in July, the Santa Clara, Calif., company gave indications that fallout from the declining PC industry is moderating even as more lucrative server-chip sales grew less than expected.