Intel Reports Record Year

$54 Billion in Annual Revenue Up 24 Percent, $2.39 in Annual EPS Up 19 Percent

Intel Corporation today reported full-year revenue of $54 billion, operating income of $17.5 billion, net income of $12.9 billion and EPS of $2.39 -- all records. The company generated approximately $21 billion in cash from operations, paid dividends of $4.1 billion and used $14.1 billion to repurchase 642 million shares of stock.

For the fourth quarter, Intel posted revenue of $13.9 billion, operating income of $4.6 billion, net income of $3.4 billion and EPS of 64 cents. The company generated approximately $6.6 billion in cash from operations, paid dividends of $1.1 billion and used $4.1 billion to repurchase 174 million shares of stock.

“2011 was an exceptional year for Intel,” said Paul Otellini, Intel president and CEO.  “With outstanding execution the company performed superbly, growing revenue by more than $10 billion and eclipsing all annual revenue and earnings records. With a tremendous product and technology pipeline for 2012, we’re excited about the global growth opportunities presented by Ultrabook systems, the data center, security and the introduction of Intel-powered smartphones and tablets.”

Business Outlook

Intel’s Business Outlook does not include the potential impact of any mergers, acquisitions, divestitures or other business combinations that may be completed after Jan. 19.

Q1 2012 (GAAP, unless otherwise stated)

• Revenue: $12.8 billion, plus or minus $500 million.
• Gross margin percentage: 63 percent and 64 percent Non-GAAP (excluding amortization of acquisition-related intangibles), both plus or minus a couple percentage points.
• R&D plus MG&A spending: approximately $4.4 billion.
• Amortization of acquisition-related intangibles: approximately $75 million.
• Impact of equity investments and interest and other: approximately zero.
• Depreciation: approximately $1.5 billion.

Full-Year 2012 (GAAP, unless otherwise stated)

• Gross margin percentage: 64 percent and 65 percent Non-GAAP (excluding amortization of acquisition-related intangibles), both plus or minus a few percentage points.
• Spending (R&D plus MG&A): $18.3 billion, plus or minus $200 million.
• R&D spending: approximately $10.1 billion.
• Amortization of acquisition-related intangibles: approximately $300 million.
• Depreciation: $6.5 billion, plus or minus $100 million.
• Tax Rate: approximately 29 percent.
• Full-year capital spending: $12.5 billion, plus or minus $400 million.

For additional information regarding Intel’s results and Business Outlook, please see the CFO commentary at: www.intc.com/results.cfm.

Status of Business Outlook

Intel’s Business Outlook is posted on intc.com and may be reiterated in public or private meetings with investors and others. The Business Outlook will be effective through the close of business March 16 unless earlier updated; except that the Business Outlook for amortization of acquisition-related intangibles, impact of equity investments and interest and other, and tax rate, will be effective only through the close of business on Jan. 26. Intel’s Quiet Period will start from the close of business on March 16 until publication of the company’s first-quarter earnings release, scheduled for April 17. During the Quiet Period, all of the Business Outlook and other forward-looking statements disclosed in the company’s news releases and filings with the SEC should be considered as historical, speaking as of prior to the Quiet Period only, and not subject to an update by the company.

Q4 and 2011 Key Financial Information (GAAP)

Q4 Business unit revenue:

• PC Client Group revenue of $9 billion, up 17 percent year-over-year.
• Data Center Group revenue of $2.7 billion, up 8 percent year-over-year.
• Other Intel® architecture group revenue of $1.1 billion, up 35 percent year-over-year.
• Intel® Atom™ microprocessor and chipset revenue of $167 million, down 57 percent year-over-year.
• McAfee Inc. and Intel Mobile Communications contributed revenue of approximately $1 billion.

Full Year Business unit revenue:

• PC Client Group had revenue of $35.4 billion, up 17% from 2010.
• Data Center Group had revenue of $10.1 billion, up 17% from 2010. 
• Other Intel architecture group had revenue of $5.0 billion, up 64% from 2010.
• Intel Atom microprocessor and chipset revenue of $1.2 billion, down 25% from 2010.
• McAfee Inc. and Intel Mobile Communications contributed revenue of $3.6 billion.