Early Q4 Production Forecasts For Intel Indicate Sequential Declines

Production levels remained stable month-on-month for Intel Corporation INTC in September. BlueFin’s Steve Mullane reiterated a Positive rating on the company.

The company ended Q3 with production down 3-4 percent sequentially, 2 percent higher than the guidance.

On September 16, Intel raised its revenue guidance from $14.9 billion to $15.6 billion, attributing the increase to higher PC supply chain inventory and signs of improvement in PC demand.

Related Link: Baird Raises Target Price On Intel Following Raised Guidance

“We have been observing and reporting improving PC sentiment over the last several months and maintain our view that 2016 PC shipments will decline a more modest 5 percent year-on-year,” Mullane stated.

Product Mix

In addition, the analyst pointed out that the company has continued to increase its 14nm product mix at three of its high volume manufacturing sites, Oregon, Arizona and Ireland, while meaningfully reducing its lower node production levels at Fab 11X in New Mexico.

“INTC just recently launched their 7th generation core processor called Kaby Lake last month, extending their 14nm technology node platform,” Mullane went on to say.

Intel is now guiding to revenue growth of 15 percent for the September quarter, driven by momentum in the Data Center, IoT and improvement in the PC environment.

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