Bluefin Analysts Positive On Intel, See PC Environment Improving

The decline in PC shipments has been less than feared and the PC environment is showing “continued signs of improvement in the September quarter,” Bluefin’s Steve Mullane said in a report. He reiterated a Positive outlook on Intel Corporation INTC.

July Production

Overall production levels in July declined 4-5 percent m/m. There seems to be a significant decline in the production level of 22nm node and higher, which is offset by continued production ramp of the 14nm node. Analyst Steve Mullane estimated a 4-5 percent m/m decline in July overall production.

“Our early forecast reads indicate that the legacy node production levels will continue to decline through the September quarter resulting in a sequential decline of overall production in the 5-6% range,” Mullane wrote.

Intel appears to be still adjusting production to correct for high internal inventories. The company guided to 10 percent revenue growth for the September quarter, driven by momentum in the Data Center, IoT, and Memory segments, while maintaining a view of high single digit decline in the PC sector for 2016.

The analyst commented, however, that the sequential decline in PC shipments could be more modest than has been projected.

PC Environment Improving

While the strength of the Data Center, IoT and Memory segments is likely to increase in 2H, Intel seems to be “too conservative on their view of high single PC shipment decline for this year,” Mullane stated, estimating the decline at 5 percent.

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