Despite lagging PC sales and a slow overall economy, Intel today reported $43.6 billion in revenue for 2010, with operating income of $15.9 billion and net income of $11.7 billion, resulting in an EPS of $2.05 – all records. During the year, Intel generated approximately $16.7 billion in cash from operations, paid cash dividends of $3.5 billion, and used $1.5 billion to repurchase 70 million shares of common stock.
Yesterday, a report from IDC showed that the worldwide PC market slowed in the fourth quarter of 2010, but total shipments in Q4 were the largest ever. Total PC shipments for 2010 we reported at 346.2 million, an increase of 13.6%.
Intel says that while 2010 was a great year, 2011 is set to be an even stronger one for the company. “2010 was the best year in Intel’s history. We believe that 2011 will be even better,” said Paul Otellini, Intel president and CEO.
Intel reported a gross margin of 66 percent, up 10 percentage points compared to 2009. PC Client Group revenue was up 21 percent, Data Center Group revenue up 35 percent, other Intel architecture group revenue up 27 percent, and Intel Atom™ microprocessor and chipset revenue of $1.6 billion up 8 percent.
Net income was helped with some tax credits, with the company reporting an effective tax rate of 24 percent, lower than the company’s expectation of 31 percent primarily due to the retroactive reinstatement of the U.S. R&D tax credit.
Earlier this week Intel settled a longstanding dispute with NVIDIA, agreeing to a new six-year cross-licensing agreement and paying technology licensing fees of $1.5 Billion. The fees will be paid in five annual installments, beginning Jan. 18, 2011.
In April Intel announced that it would acquire security giant McAfee for $7.68 Billion in cash.