Electronics

According to Huacheng Import and Export Data Observation, after the US stock market closed on January 26, US Eastern Time, Intel announced its results for the fourth quarter and the whole year of 2022. The fourth quarter performance of the chip giant failed to meet the market expectations, with a sharp decline of 32%. The lowest quarterly income since 2016. At the same time, the company also predicted that there would be unexpected losses in the first quarter, and the expected range of sales would differ by billions of dollars from analysts' expectations, which would be the lowest quarterly total revenue of the company since 2010.

Not only Intel suffered heavy losses, but with the global demand for PC products slowing down, AMD and NVIDIA's quarterly revenue has experienced a larger-than-expected decline. The agency expects that PC shipments will continue to decline in 2023 and resume growth in 2024.

The same is true for smart phones. According to Huacheng Import and Export Data Observation, global smartphone shipments last year hit the lowest level in 10 years, and the fourth quarter was particularly bad, which was mainly due to the sluggish macroeconomic and weak consumer demand. The recovery of the entire consumer electronics industry is full of uncertainty.

Net profit decreased by 114% in the fourth quarter

According to the financial report, Intel's revenue in the fourth quarter was $14 billion, lower than the market expectation of $14.58 billion, which was the lowest quarterly revenue since 2016, down 32% year on year. In terms of profit, Intel's gross profit margin in the fourth quarter dropped sharply to 39.2% from 53.6% in the fourth quarter of 2021, and its net loss reached US $700 million, compared with US $4.6 billion in net profit in the same period of last year, a year-on-year profit to loss, with a decline of 114%.

In the whole year, Intel's revenue was US $63.1 billion, down 20% year on year. The annual net profit was US $8 billion, down 60% from US $19.9 billion in the previous year, and down 65% in non-GAAP.

In addition, the guidance given by Intel in the first quarter of this year is regarded as "disaster level" by the market. Intel expects its revenue in the first quarter of 2023 to be between US $10.5 billion and US $11.5 billion, significantly lower than the US $14 billion expected by the market. If its performance in the first quarter falls at the low end of the guidance range, its revenue in the first quarter of this year will be the lowest since 2010.

Intel expects that the gross profit margin in the first quarter of 2023 will be 39%, which is 14.1 percentage points lower than the same period last year, and more than 10 percentage points lower than its closest competitor AMD.

The company expects "fluctuations in all markets" this year. Specific data showed that the revenue of client computing business shrank by 36%, and the operating profit of PC chip division shrank by 82%. Intel said that the consumer and education markets were particularly hard hit. The sales of the data center fell by a third, and the operating profit of the enterprise also dropped by 84%. Huacheng Import and Export Data Observation reported.

PC market recovery is still long

In order to reverse the decline, Intel has begun to tighten its belt. The company said that layoffs, slowdown in new factory spending and other cost-cutting measures would lead to savings of $3 billion this year. The company said that by the end of 2025, this number would increase to $10 billion per year.

Intel expects that the difficulties brought by the macro environment will continue in the first half of 2023, and the long-term industry scale of the personal computer market is about 300 million units. In terms of server business, which accounts for 70% of the global market, Intel said that this field will also shrink in the first half of this year. "Like PC manufacturers, these customers are also cutting their orders when dealing with unused inventory. Intel expects the server market to resume growth in the second half of 2023."

However, in the view of the market, the recovery time will be longer. IDC predicted in a report that PC shipments will continue to decline in 2023 and will not recover until 2024.

In fact, not only Intel, but also PC chip players including AMD and NVIDIA are in difficult times. Similar problems also plague AMD, and it will take time to digest the inventory of graphics cards, which will ultimately affect the revenue. However, the investment institutions are optimistic about the prospects of AMD in the second half of this year, and believe that it will start to rebound at the end of the second quarter of this year. It is the key to use EPYC processors to seize the market share of enterprises from competitors.

NVIDIA performs relatively well under the current inventory problem and consumer spending reduction. Although the game department is still under great pressure, it has exceeded analysts' expectations. As partners gradually clear their inventory and GeForce RTX 40 series graphics cards are gradually rolled out, Nvidia's momentum in 2023 may be stronger than many people think, Huacheng Import and Export Data Observation reported.

The lowest shipment of smart phones in 10 years

The slump in the PC market led to a sharp drop in Intel's performance, while the smartphone industry at the other end of consumer electronics experienced the worst year in a decade. According to the data, the total number of PC shipments in 2022 was 290 million, down 16.5% from the previous year. However, from the historical data, PC shipments are still significantly higher than the level before the outbreak of the COVID-19 epidemic. However, smartphone shipments have fallen to the lowest level in 10 years.

According to the latest report released by IDC on the 26th, the global smartphone shipments reached the lowest level in 10 years last year, and the fourth quarter was particularly bad, mainly due to the sluggish macroeconomic and weak consumer demand.

According to IDC data, the global smartphone shipment in 2022 was 1.21 billion units, down 11.3% from the previous year, which is the lowest annual shipment since 2013. IDC said that the reason for the drop in shipments was the sharp drop in consumer demand, inflation inflation and economic uncertainty.

Apple continues to maintain its position as the world's largest smartphone manufacturer. The company shipped 72.3 million iPhones in the fourth quarter of last year, down 14.9% year on year. Apple's market share in the current quarter rose to 24.1% from 23.1% last year, but its sales fell by 14.9% compared with the same period last year. Huacheng Import and Export Data Observation reported.

Samsung's shipments were second only to Apple, with 58.2 million units shipped in the fourth quarter, down 15.6% year on year. Xiaomi ranked third, with the shipment volume of 33.2 million units in the fourth quarter, down 26.3% year on year. Anthony Scarsella, an analyst at IDC, warned that given that global smartphone shipments fell by more than 11% last year, 2023 would be a prudent year, and suppliers would reconsider their equipment portfolio, while channel operators would think twice after absorbing excess inventory.