Pat Gelsinger, CEO of VMware, speaks at the company’s VMworld conference in San Francisco in 2012.

Kim Kulish | Corbis News | Getty Images

Intel’s sales were essentially flat, and profits fell in the first quarter of 2021 in CEO Pat Gelsinger’s first quarterly report.

Intel’s earnings per share were well above analysts’ estimates and the company’s own forecast, but Intel stock was down slightly in expanded trading. Sales were also above the analysts’ estimates.

Here’s how Intel behaved compared to refinitive consensus estimates:

  • Earnings per share (EPS): $ 1.39 versus $ 1.15 (adjusted) expected, a 1% decrease from last year
  • Revenue: $ 18.57 billion vs. $ 17.90 billion (adjusted) expected, unchanged from last year

For the second fiscal quarter of Intel a turnover of 17.8 billion US dollars is expected, which is slightly above the analysts’ expectations of 17.55 billion US dollars.

Gelsinger, who took over the company in February, announced earlier this month that Intel would invest $ 20 billion in new microchip manufacturing equipment and announced it would become a contract chip maker or foundry in addition to the I will manufacture chips from other companies’ own chips.

However, it will take years to complete this plan. For the quarter that ended in March, Intel’s quarterly revenue and quarterly results were largely unchanged from the same period last year, even though demand for microchips skyrocketed around the world.

According to several estimates, sales fell as PC sales had its best quarter in years. Intel previously announced it expected double-digit growth in PCs this year, and PC sales boosted the chipmaker in the quarter.

In the year-ago quarter, Intel had sales of $ 9.78 billion in its client computing group, including PC chips, compared to $ 10.61 billion in the last quarter.

Intel said notebook chip sales were a record for the company and that PC volume rose 38% for the quarter.

However, many of these laptops and desktops are budget Chromebooks that use cheaper chips. Apple, an Intel customer, is increasingly using its own chips instead of Intel for its Mac PC range.

Intel also sells high-performance chips for data centers. Revenue grew last year as companies expanded their cloud operations while employees worked from home. A year ago, Intel had sales of $ 6.99 billion in its data center group compared to $ 5.56 billion for the quarter.

Intel has seen setbacks in making its most advanced chips, which use a manufacturing process called 7 nanometers. Companies like Nvidia, which announced its own data center chip earlier this year, and AMD, which boasts of outperforming Intel on some key computer performance metrics, are also facing increasing competition.

Gelsinger’s plan to become a foundry and increase production in the US won’t come cheap.

Earlier this month, Intel announced that it expected full year 2021 earnings of $ 4 per share and revenue of $ 76.5 billion. Intel raised that forecast on Thursday to earnings of $ 4.60 per share and revenue of $ 72.5 billion.