Intel reported better than expected financial results and a record-breaking full year revenue of $55.9 billion. In a conference call highlighting his first full year, Intel’s CEO said the company is “in a very different place” than it was 12 months ago and finished the year with a strong fourth quarter.
2014 revenue grew 6% while operating income rose 29% to $15.3 billion and net income hit $11.7 billion. Intel generated approximately $20.4 billion in cash from operations, paid dividends of $4.4 billion, and used $10.8 billion to repurchase 332 million shares of stock. Fourth quarter revenue was $14.7 billion and operating income was reported at $4.5 billion, with a net income of $3.7 billion.
“We met or exceeded several important goals: reinvigorated the PC business, grew the data center business, established a footprint in tablets, and drove growth and innovation in new areas,” Intel CEO Brian Krzanich said in a release, adding that the company will “improve our profitability in mobile, and keep Intel focused on the next wave of computing” in 2015.
Revenues from the PC Client Group (PCG) and data center business outperformed expectations set earlier this year. The Data Center Group reported revenue of $14.4 billion, up 18% year-over-year while the newly formed PCG reported revenue of $34.7 billion, up 4% percent from 2013. Revenue from the Mobile and Communications Group, which merged into PCG last year, dropped 85% to $202 million.
Krzanich said Intel has succeeded in its goal to stabilize the PC business with a 25% increase in operating profits where the company had previously expected a decline. He noted that Intel exceeded its 40 million tablet shipment goal by 6 million units and wouldn’t work to outpace the mobile market.
Instead, Intel will focus on driving down costs for the mobile/tablet businesses by $800 million. Intel officials expect the introduction of its inexpensive smartphone chips — the Sofia 3G and Sofia LTE — later this year to “progressively reduce bill of materials costs that affected margins in the mobile chip business.”
