Intel Reports Second-Quarter Revenue of $13.5 Billion
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INTEL CORPORATION
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SUPPLEMENTAL RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS
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In addition to disclosing financial results in accordance with
United States (U.S.) generally accepted accounting principles
(GAAP), this document contains non-GAAP financial measures that we
believe are helpful in understanding and comparing our past
financial performance and our expectations for future results. The
non-GAAP financial measures disclosed by the company exclude the
amortization of acquisition-related intangible assets, as well as
the related income tax effect. Amortization of acquisition-related
intangible assets consists of the amortization of developed
technology, trade names, and customer relationships acquired in
connection with business combinations. We record charges relating to
the amortization of these intangibles in our GAAP financial
statements. Amortization charges for our acquisition-related
intangible assets are inconsistent in size and are significantly
impacted by the timing and valuation of our acquisitions.
Consequently, our non-GAAP adjustment excludes these charges to
facilitate an evaluation of our current operating performance and
comparisons to our past operating performance.
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Set forth below are reconciliations of the non-GAAP financial
measures to the most directly comparable GAAP financial measures.
The non-GAAP financial measures disclosed by the company have
limitations and should not be considered a substitute for, or
superior to, financial measures prepared in accordance with GAAP,
and the financial results prepared in accordance with GAAP and
reconciliations from these results should be carefully evaluated.
Management believes the non-GAAP financial measures are appropriate
for period to period comparisons in our budget, planning and
evaluation processes, and to show the reader how our performance
compares to other periods.
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(In millions, except per share amounts)
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Three Months Ended
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Six Months Ended
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June 30,
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July 2,
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June 30,
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July 2,
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2012
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2011
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2012
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2011
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GAAP GROSS MARGIN
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$
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8,554
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$
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7,902
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$
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16,819
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$
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15,787
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Adjustment for the amortization of acquisition-related intangibles
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142
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136
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279
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210
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NON-GAAP GROSS MARGIN
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$
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8,696
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$
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8,038
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$
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17,098
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$
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15,997
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GAAP GROSS MARGIN PERCENTAGE
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63.4
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%
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60.6
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%
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63.7
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%
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61.0
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%
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Adjustment for the amortization of acquisition-related intangibles
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1.0
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%
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1.1
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%
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1.0
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%
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0.8
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%
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NON-GAAP GROSS MARGIN PERCENTAGE
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64.4
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%
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61.7
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%
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64.7
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%
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61.8
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%
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GAAP OPERATING INCOME
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$
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3,832
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$
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3,935
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$
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7,642
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$
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8,093
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Adjustment for the amortization of acquisition-related intangibles
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220
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212
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438
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322
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NON-GAAP OPERATING INCOME
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$
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4,052
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$
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4,147
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$
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8,080
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$
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8,415
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GAAP NET INCOME
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$
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2,827
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$
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2,954
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$
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5,565
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$
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6,114
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Adjustment for:
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Amortization of acquisition-related intangibles
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220
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212
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438
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322
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Income tax effect
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(74
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(38
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(147
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(69
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NON-GAAP NET INCOME
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$
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2,973
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$
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3,128
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$
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5,856
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$
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6,367
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GAAP DILUTED EARNINGS PER COMMON SHARE
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$
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0.54
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$
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0.54
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$
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1.07
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$
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1.11
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Adjustment for:
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Amortization of acquisition-related intangibles
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0.04
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0.04
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0.09
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0.06
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Income tax effect
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(0.01
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(0.01
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(0.03
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(0.02
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NON-GAAP DILUTED EARNINGS PER COMMON SHARE
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$
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0.57
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$
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0.57
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$
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1.13
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$
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1.15
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