Intel ups Q3 revenue outlook, cites expected PC turnaround

Demand for PCs has been stagnant at best, but Intel thinks a turnaround is on the horizon.

The chipmaker on Friday raised its third quarter revenue outlook, saying the increase was "primarily driven by replenishment of PC supply chain inventory." Intel says it's also seeing "some signs of improving PC demand."

Intel now expects Q3 revenue of $15.6 billion, up from the previously guided $14.9 billion. Expenses from research and development and mergers and acquisitions are projected to be $5.2 billion, an increase of $100 million from the prior expectation.

Intel also shifted its gains and losses, saying it now expects a Q3 net loss of approximately $125 million, up from the previous forecast of $75 million.

Despite its newfound PC optimism, most of Intel's investments as of late have been focused on enterprise infrastructure. Earlier this year the tech giant announced plans to cut 12,000 jobs -- or nearly 11 percent of its workforce -- as part of a major restructure prompted by the decline in PC sales and other hardware.

At the time, Intel CEO Brian Krzanich said he believed Intel could transform from a PC company to "a company that powers the cloud and billions of smart, connected computing devices" by focusing on technology for connected things, memory, connectivity, Moore's Law, and cloud.

Last quarter, however, revenue across Intel's key business units was relatively weak, including in its data center group and Internet of Things (IoT) group. The data center group had revenue of $4 billion, up 1 percent sequentially and up 5 percent year-over-year. Intel's IoT group posted revenue of $572 million, down 12 percent sequentially and up just 2 percent year-over-year.