Intel lifts full-year forecasts on data centre strength

Intel, the world's biggest computer chipmaker, raised its full-year revenue and profit forecasts, helped by strong growth in its data centre business.

The company's shares were up 2.2. percent at US$42.25 in extended trading.

For the full year, the company said it expected to earn, on an adjusted basis, US$3.25 per share on revenue of $62 billion, beating analysts' estimate of $3.01 per share on revenue of US$61.4 billion, according to Thomson Reuters I/B/E/S.

In July, the company had previously forecast full-year adjusted profit of US$3 per share on revenue of $61.3 billion.

"The combination of a solid quarter and healthy guidance will be something the bulls can hang their hat on tomorrow," Daniel Ives, chief strategy officer at GBH Insights said.

Revenue from Intel's higher-margin data centre business rose 7 percent to US$4.9 billion in the third quarter, beating analysts' expectation of US$4.79 billion, according to financial data and analytics firm FactSet.

"We're going to see it continue to become a bigger and bigger portion of our business," chief financial officer Bob Swan said on a call.

Intel, which has been switching its focus to the data centre business, is also venturing into newer areas such as artificial intelligence and driverless cars to reduce its reliance on the PC market.

The chipmaker completed the acquisition of Israeli autonomous vehicle technology firm Mobileye in August to compete with peers such as Qualcomm and Nvidia and tap the fast-growing market of driverless cars.

"With cloud, internet of things, and self-driving cars creating newer growth areas, now is the time for Intel to lay the seeds of growth in these key areas," Ives said.

Revenue from client computing, as Intel calls its PC chip business, remained flat at US$8.9 billion. Analysts had expected revenue of US$8.68 billion, according to FactSet.

Intel recently launched its Coffee Lake line of processors, which analysts believe will pose challenges for rival AMD's Ryzen processors.

The company's net income rose to US$4.52 billion, or 94 US cents per share, in the third quarter ending 30 September, from US$3.38 billion, or 69 US cents per share, a year earlier. 

Excluding items, the company earned US$1.01 per share, beating analysts' estimate of 80 US cents per share.

Revenue rose 2.4 percent to US$16.15 billion, beating estimates of US$15.73 billion.

(Reporting by Laharee Chatterjee in Bengaluru; Editing by Shounak Dasgupta)