00:00And right now we are two minutes away from the end of the trading day.
00:03Romain Bostic alongside Katie Greifeld taking you through to that closing bell with a global simulcast.
00:08Carol Masser and Tim Stenevich join us now.
00:11Welcome to our audiences across all of our Bloomberg platforms, television, radio, our partnership with YouTube.
00:16Stocks on the back foot, well, unless you're a chip stock.
00:19The Philadelphia Semiconductor Index, Carol Masser, headed towards a record high.
00:23Pretty much everything in that index has been on a tear for the last month, and that includes Intel.
00:29Yeah, that also includes Texas Instruments with, I think it's at its record, and I think it's up the most
00:35since about five and a half years ago.
00:37I mean, Texas Instruments, who would have thunk?
00:39Last night we were focusing on Tesla, IBM, but Texas Instruments, really the mega outperformer, that stock up about 19%,
00:46and that also helping lift the overall semi-sector.
00:49Well, we're focused on the equity market and certainly the companies that are reporting results.
00:53But, Katie, we're also focused on energy on a day when everybody's wondering what the latest out of the Middle
00:58East and the Strait of Hormuz will mean for the end of this, well, now becoming prolonged conflict.
01:04Right.
01:04Energy price is up again today, $105.70 for a barrel of Brent, WTI, up 3.4% to $96.
01:11Yeah, it's interesting to see Brent back above $105.
01:15Wondering if that's a little bit of an input when you think about this, a little bit of a pullback
01:20that we're seeing in the S&P 500.
01:22Of course, earnings being a nice distraction, but if we stay around these levels or potentially go higher, have to
01:29imagine that's going to impact some of the sentiment back on Wall Street.
01:32Yeah, of course, chip stocks, at least for right now, have become one of the safe havens on Wall Street.
01:37Mike Antopoulos was talking about the narrow nature of the broad market rally, a broad market rally that's been on
01:42pause for the last, at least for this week here.
01:44And that includes today with the Dow Jones Industrial Average losing almost 200 points on the day, down about four
01:50-tenths of a percent.
01:51The S&P 500 also dropping about four-tenths of a percent, but still holding around 7,100.
01:56The Nasdaq down about nine-tenths of a percent, and the Russell 2000 down about four-tenths of a percent
02:01as we wait, Carol, for those earnings from Intel.
02:03Yeah, we are waiting.
02:04In the meantime, back to the S&P, almost an even split, Katie.
02:08272 names higher in the Thursday trade, 230 to the downside, one unchanged.
02:14Well, let's take a look at what we're seeing at the sector level, as measured by our friend the Circle.
02:18You can see a real patchwork display here.
02:22You had five sectors in the green, but the six sectors that were in the red are big ones.
02:27Information technology down about one-and-a-half percent, even though we did have a big day when it comes
02:32to the chip space.
02:33Financials, consumer discretionary also taking a dive.
02:36In terms of what managed to do well today, industrials higher by nearly 1.8 percent, and consumer staples higher
02:43by 1.7 percent, Carol.
02:45Certainly looks defensive.
02:46All right, as we wait for Intel, expected to cross any moment, I'm just going to, again, go back to,
02:51ah, we've got it.
02:52Let's go to it.
02:53Intel earnings out right now.
02:541Q revenue, $13.6 billion.
02:57The street was looking for 12.4.
02:58That is a beat.
02:59Operating margin at 12.3 percent.
03:02The street was looking for 3.08.
03:04So that is also a beat as well.
03:06Adjusted EPS, 29 cents.
03:08The street was looking for 1 cents.
03:09That's a beat.
03:10Here's your forecast for the second quarter.
03:12The company says expect revenue in the range of $13.8 to $14.8 billion.
03:17The low end of that range is above the average of street estimates.
03:20They were looking for about $13 billion even.
03:23Data center activity in the most recent quarter also coming in at about $5 billion.
03:28That is above estimates.
03:29And I just want to also just put a finer note on this, Carol and Tim.
03:33When we talk about this idea of where this company goes next, that foundry business here,
03:37I just want to put a little bit of a focus on that as well.
03:40The headline in the most recent quarter, foundry revenue, $5.42 billion.
03:44The street was looking for $4.8.
03:46Yeah, that's a big beat and higher by about 16 percent year over year.
03:51You can see in the press release the CFO saying that we remain focused on maximizing our factory
03:56network to improve available supply and meet our customer needs throughout the year.
04:01Tim, you take a look at this pop after hours, Intel higher by about 10 percent.
04:05This was a company that had a big bar to clear when it comes to recent expectations.
04:10Yeah, I'm going back to the press release like you were looking at, Katie.
04:14Agentic AI, the next wave of AI will bring intelligence closer to the end user.
04:18A solid foundation in place.
04:20Liputan also talking about the deliberate reset on how we operate.
04:23Drove a sixth consecutive quarter, as you mentioned.
04:26I go back to the U.S. investment in this and what that means for this company, if this
04:32company would have been able to do this without the U.S. investment, where they are in this
04:36turnaround, what the exit of this investment looks like, if ever.
04:40I mean, we're in a unique time period where the U.S. citizen is a shareholder of this company,
04:48which I think has done very, very well, at least since the U.S. made that investment.
04:54It's an interesting chapter in the history of U.S. capitalism, that's for sure.
04:57Yeah, we're not even talking about Spirit Airlines.
04:59We won't go there.
05:00It's also an interesting case in terms of just watching the market reaction.
05:03I mean, Intel is a stock that's up 80 percent year to date.
05:07It's up another 12 percent.
05:08Ian King out, who knows this company so well, out with a read-through on the earnings.
05:12He talked, it looks like, in an interview with the CEO, Liputan.
05:18And what Tan said was, there is huge demand.
05:20We are working very hard with our team to make sure we deliver, that we meet the demand.
05:24But we are still short because the demand keeps increasing from the customers.
05:30He said Intel delivered a solid result ahead of its projections.
05:34And he expects the strong demand for processors used in AI systems to expand.
05:38So the company is laser-focused on increasing output from Intel's factories,
05:42which still cannot produce enough to fill all its orders.
05:46And this is where companies have gotten into trouble.
05:48The demand's there, but they can't meet it.
05:49Well, this has always been the concern.
05:51I mean, even prior to Liputan was the idea that we knew the potential was there.
05:54The question is, can they fill it?
05:56They talk a lot about, in the press release and some of the headlines crossing the wire,
06:00lifting the CapEx plan for 2026 to even with last year.
06:04Also talking about how it's investing more in new machinery.
06:08It also points out, though, too, that it's not commenting,
06:11and thanks for putting up the Brady Brunch screen there,
06:12that it's not commenting on deals yet with external customers here.
06:16So, Tim, of course, you talk about some of the statecraft involved here
06:19and the idea that at least if we're talking about a homegrown sort of fab business here in the U
06:25.S.,
06:26what the capabilities can be, but more importantly,
06:29can it start to actually show and prove on that sometime soon?
06:32You're talking about the foundry business?
06:34Yeah.
06:34So let's go back to Ian's story.
06:36Look at the shares are up 17% right now.
06:38All right.
06:38The foundry services division, according to Ian, that's the company's factory unit,
06:44generated revenue of $5.4 billion, up 16%.
06:46The unit currently relies almost exclusively on Intel product divisions for orders.
06:52This isn't me.
06:53This is Ian King, who knows this company.
06:54Though it is seeking, as we know, outside customers.
06:57It's PC chip division had revenue of $7.7 billion,
06:59and the data center unit posting sales of $5.1 billion.
07:03All of those totals topping Wall Street estimates.
07:04I wonder if this is sort of indicative of kind of the evolution of this AI data center space,
07:09and we were talking with an analyst a couple days ago about the shift from GPUs to CPUs,
07:13the focus from GPUs to CPUs, and the idea that this kind of benefits, if you will,
07:17kind of some of the older chip makers.
07:19I mean, I was kind of joking at the top of the show how old and boring Texas Instruments was,
07:23but, you know, let's face it, Intel is basically the second oldest chip maker out there in the U.S.,
07:27at least, still standing.
07:28But it's hot, Carol.
07:30We've got to go.
07:31Okay.
07:32Yeah, don't dilly now.
07:34It was up 84% last year, and this year it's up 81%.
07:40Well, it's up 70% in the after-hours trade.
07:42Before after-hours move.
07:43Yeah, so break out your Texas Instruments calculator and figure that out.
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