Intel 4Q14 Earnings Call Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. Full transcripts can be found at Seeking Alpha

Outperformed expectations to start the year

“We began 2014 expecting roughly flat year-over-year revenue and operating income. Instead the company’s full year revenue grew 6% touching all time record of $55.9 billion. At the same time, operating income rose 25%.”

Shipped 46m tablets last year

“n the mobile and communications group, we set a goal to ship 40 million tablets in 2014. This goal is intended to establish Intel architecture in the marketplace and scale the supply chain and the chart developers. I’m pleased to report that we shipped 46 million tablets, becoming one of the industries largest merchant silicon providers in tablets.'”

Moving quickly to wearables

“you see us moving quickly to wearables, to our growing portfolio of collaborations with Google Glass, fashion and fitness brands like Fossil, Oakley, Opening Ceremony and SMS Audio along with our own products like the Basis Peak and the Curie Module are computed at the size of a button.”‘

PC supply chain appears healthy

“he worldwide PC supply chain appears to be healthy with inventory levels appropriate as we enter the first quarter.”‘

Lots of Capex and MG&A

“We are forecasting R&D and MG&A spending for the year at $20 billion, plus or minus $400 million and we are forecasting capital spending of $10 billion, plus or minus $500 million.’

Touting a Dell tablet powered by Intel

“The other place you saw, the Dell Venue 87000 is a great example, was one best of innovation at CES and best of show at CES and it’s showing a thinnest tablet with real innovation at a $399 price where people can start to make money in the tablet space a little bit now again. And so we think the combination of right products plus real innovation like that will allow us to make real progress.”

Cash generation geographically diverse

“remember, we actually invest in factories around the world. So a lot of the onshore versus offshore will vary based on where we’re starting up factories. But the majority of our cash generation is in the U.S. We do generate a lot of cash and we certainly have the ability to use that for any corporate purposes including our buyback.”

Very comfortable with inventory levels

“as Stacy mentioned, our inventories as we exit Q4, we’re very comfortable with where the inventories are. So remember, as we entered — exited Q3 and kind of entered Q4, there might have been — there are some concern that might have been over the inventory. We felt we’ve burn that off to the system, especially a lot of that was down at the low end. And as we exit Q4, we’re very comfortable with inventory.”

A good quarter for server too

“We just had a very strong quarter in terms of server and our server mix is starting to look better, is starting to improve some.”

High end PC did well and low end as well

“at the same time as you said we saw record Core i7 and the gaming PCs are hitting record levels. And so the high end kind of did very well as well. And we’ve been working on filling in that middle.’

Not going to slow down skylake even though Broadwell was late

“et me first kind of answer how we are looking at this and we are not going to slow Skylake down. We said it will be a second half of this year. I don’t want to slow it down because it brings a lot of innovation, a lot of new capability to this market.”