The flip side is that the enterprise business was weaker. A recovery in the second half of the year isn’t likely, either, officials said.
“It’s more macroeconomic driven than anything else, and we’re not predicting a big macroeconomic boom in the back half,” Intel CFO Stacy Smith said during Wednesday’s earnings call.
Whether Intel benefits from the enterprise/cloud tradeoff wasn’t clear, as Intel didn’t quantify its enterprise sales. But it’s definitely a boon to the Data Center Group, which reported second-quarter revenues of $3.9 billion, about 30 percent of Intel’s total revenues and up 10 percent from the same quarter a year ago.
The Data Center Group had exhibited 19 percent year-over-year growth in the first quarter, but Intel pointed out that this is a lumpy business, meaning revenues will fluctuate unpredictably. Smith and CEO Brian Krzanich said they were happy with the averaged-out result of 14 or 15 percent growth for the first six months of the year.
You might recall that Cisco, in contrast to Intel’s outlook, recently said enterprise sales are going gangbusters. But of course, the companies are in different businesses. Cisco is selling combinations of products with the aim of changing business models and processes. Intel’s enterprise revenues come from running workloads on servers — something that’s easily handed off to the cloud.
Overall, Intel reported second-quarter revenues of $13.2 billion and net income of $2.7 billion, or 55 cents per share. Analysts had been expecting 50 cents per share, according to Zacks.
For the same quarter a year ago, Intel reported revenues of $13.8 billion and net income of $2.8 billion, again 55 cents per share.
Intel shares were down 26 cents (1%) at $29.43 in midday trading Thursday.