UPDATE 2-Data center, PC demand drives Intel profit beat

Revenue from its data center business rose 25.9 percent to $6.14 billion in the quarter, while analysts were expecting revenue of $5.89 billion, according to financial and data analytics firm FactSet.

Intel Corp beat analysts' estimates for quarterly profit and revenue on Thursday, riding on the back of its high-margin data center business and strong demand for its PC chips, sending its shares up about 6 percent in extended trading.

Investors are watching Intel's earnings anxiously after fellow chipmakers Texas Instruments Inc, STMicroelectronics NV and SK Hynix warned of slowing demand for the remainder of the year, sending their shares down and helping spark a sell-off on stock markets globally.

Intel has been increasingly catering to data centers as revenue from PCs has flattened, benefiting from more businesses and mobile devices moving to cloud for computing needs.

Revenue from its data center business rose 25.9 percent to $6.14 billion in the quarter, while analysts were expecting revenue of $5.89 billion, according to financial and data analytics firm FactSet.

Rival Advanced Micro Devices Inc, which has been gaining ground with its new EPYC chips for servers, reported better-than-expected quarterly profit on Wednesday but forecast fourth-quarter revenue below estimates due to falling demand for its graphics chips from cryptocurrency miners.

Revenue in Intel's client computing business, which caters to PC makers and is still the biggest contributor to sales, rose 15.5 percent to $10.23 billion, beating FactSet estimates of $9.33 billion.

Intel's PC sales have trended positive in recent quarters, lifted by stronger demand. Many businesses have started the process of buying new PCs because Microsoft Corp has said it will end support for Windows 7 in early 2020.

Net income rose to $6.40 billion, or $1.38 per share, in the third quarter ended Sept. 29 from $4.52 billion, or 94 cents per share, a year earlier. https://bit.ly/2Q193je

Excluding items, the company earned $1.40 per share.

Net revenue rose 18.7 percent to $19.16 billion.

Analysts on average were expecting adjusted earnings of $1.15 per share and revenue of $18.11 billion, according to Refinitiv data.

The company is still in the midst of a CEO search following the departure of Brian Krzanich in June after an investigation found he had a consensual relationship with an employee in breach of company policy. Chief Financial Officer Robert Swan is currently acting as its interim CEO. 

(With inputs from agencies.)