Intel grows in Q1 2020 thanks to PC and cloud. But the future impossible to decipher

Never as in this period has it been difficult to interpret i tax results of companies. The effects of the pandemic are also beginning to be seen in the cold numbers of the accounting books, and the forecast data are almost impossible to compile. This is also the case with Intel, which takes advantage of the publication of the results for the first quarter of 2020 to try to make the picture of what will happen during the year.

Basically, Intel admits to not being able to make predictions for the future: the upheaval caused by the lockdown and the interruption of production activities is unprecedented, and this will certainly affect the "financial conditions and results of operations"from Intel. How much, you cannot know. The difficulties arise from the fact that obviously it is not only Intel that has been affected: future results will depend on the entire chain, from suppliers to the end customer. Without forgetting the financial market: uncertainties will affect the company's resources and capital.

Intel does not rule out the possibility of entering into a global recession, driven by the uncertainty that the pandemic is generating in the economy and in the whole society. "It is difficult to predict the nature and extent of impacts on the demand for our products"is explained in a note, which continues:"Our expectations are subject to change without notice, and investors are urged not to place undue reliance on our Business Outlook".

So a two-sided situation, both conditioned by the coronavirus: on the one hand there is the first quarter, in which the pandemic led to a increased demand for some products and services (PC, chip, cloud)on the other there is the immediate future, in which the pandemic itself risks leading to one unsustainable economic and financial situation.

To date, Intel is experiencing continuous interruptions in production processes – semiconductors above all – and, according to the words of CEO Bob Swan, important projects have been paused. And there are no longer certainties about the possible recovery of the investments in progress for the realization of the Intel Tiger Lake processors with Core Sunny Cove architecture (pending the transition to 7nm, given the difficulties encountered with the 10nm production node): the company had previously envisaged a "suffering" Q2 due to the financial efforts related to it (see: accounting of the costs for the production of the processors), but had also hypothesized an important return already starting from the third quarter.

Now this certainty is less, putting the investment itself at risk: everything will depend on the ability to be able to sell the processors in Q3 which, according to company management reports, should be integrated into fifty laptops ready to be sold on the market during the Christmas holidays.