Expect Intel's Growth Streak to Continue

Fourth-quarter revenue rose 4% year over year and 8% when excluding the McAfee divestiture, to $17.05 billion. As expected, client computing group, or CCG, sales were down 2% year over year at $8.95 billion, which is consistent with the declines in the broader PC market. CCG includes both PC and mobile businesses, and given Intel’s increasing modem share in the Apple iPhone, we surmise PC revenue was understandably lower. Data center group, or DCG, revenue increased 20% year over year, with the cloud and communication service provider, or CSP, market segments up 35% and 16%, respectively. Given the tepid spending environment for CSP, Intel has likely gained share in this market. Enterprise spending in DCG was also up 11% year over year during the seasonally strong quarter, though we expect this market segment to resume low-single-digit declines going forward due to the ongoing shift to the cloud.

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