Intel‘s (NASDAQ:INTC) fiscal 2020 first-quarter results were a tad disappointing as the chip giant withdrew its full-year guidance on account of the uncertainty caused by the novel coronavirus pandemic.
Though the company managed to turn in impressive numbers for the quarter, delivering 23% annual revenue growth and a 63% increase in adjusted earnings per share (EPS), the second-quarter earnings guidance fell short of expectations. Intel’s guidance points toward a 12% increase in revenue and a 4% improvement in EPS, which pales in comparison to the prior quarter.
This sharp drop-off means Intel may not be able to sustain its coronavirus-driven momentum. One of the reasons why that may be the case is the fact the company continues to lag rival Advanced Micro Devices (NASDAQ:AMD) on the technology curve.
Intel gets a shot in the arm, but AMD is prepared
A closer look at Intel’s performance and the second-quarter guidance indicates that it is doing well in these uncertain times thanks to a jump in demand for telecommuting and online education. As social distancing measures have kept people confined to their homes, demand for computers and data center products has risen.
Market research firm NPD Group pointed out in March that laptop and notebook sales were surging as people took to working from home. This gave Intel’s client computing group (CCG) a shot in the arm with revenue up 14% annually to $9.8 billion. The company attributes this jump to an increase in model sales and strength in the notebook market. Intel CFO George Davis added on the earnings call:
PC unit volumes were up 13% year-over-year on higher notebook demand and increased supply. Notebook demand strength is expected to continue into Q2 with more people working and learning from home due to…