Intel Down Big, Amazon Flat

PC Chip leader Intel INTC 47.30 -0.08 -0.16% reported last night after the close $0.89 a share on revenue of $16.1 B. Estimates were for $0.87 cents a share, revenue $16.0 B.

But… they lowered guidance for the rest of the year to $4.35 per share on revenue of $69.0 B. Previous guidance was $4.60 / $71.5 B, consensus of $4.51 on $70.77 B. So analysts were expecting lower than guidance, but not this low!

“Our conversations with customers and partners across our PC and data-centric businesses over the past couple months have made several trends clear. The decline in memory pricing has intensified. The data center inventory and capacity digestion that we described in January is more pronounced than we expected. And China headwinds have increased, leading to a more cautious IT spending environment,” Swan explained. “We’ve reassessed our 2019 expectations based on the challenges we’re seeing.”

The new guidance numbers mark the first possible year over year revenue drop since 2015.

Semiconductors across the board are having a pretty rough day. Nvidia, Micron, AMD, Applied Materials all being drawn down by either Intel’s poor performance or the market as a whole.

Amazon

I don’t think I’ve seen analysts ever come close to predicting Amazon’s earnings. They nailed the revenue though! Amazon AMZN 1,901.49 +0.12 +0.01% reported $7.09 a share on revenue of $59.7 B. Expectations were for $4.72 per share on revenue of $59.7 billion, whisper number wasn’t close either at $4.95 a share.

The company said it expects second quarter revenue of $59.5 billion to $63.5 billion. The current consensus revenue estimate is $62.6 billion for the quarter ending June 30, 2019.

The big news out of Amazon was the announcement it would invest $800 million in the second quarter to deliver faster. One day faster! Prime members will go from free two-day to free one-day. Many things purchased through Amazon are already one-day free and a some within a few hours.

One-day delivery will surely put pressure on Walmart to up it’s game.

At over 100 million users paying $119 a year, about 4 billion in revenue per quarter comes just from Prime.