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As a result, we now expect gross CapEx in 2024 to be between $25 million and $27 million. That is a reduction of over 20% from our plan entering the year and additionally reflects expectations for softer second half demand.
Combined with strong execution of our smart capital strategy, including our second skip with Apollo, we expect net capital spending in 2024 of between $11 billion and $13 billion. These benefits will carry forward to next year as well.
For 2025, gross capital spending is targeted between $20 billion and $23 billion and net capital spending between $12 billion to $14 billion. Increased capital efficiency as a positive impact to gross margins over time, but we will also accelerate improvements by generating roughly $1 billion of savings and nonvariable cost of sales in 2025. Once again, these reductions do not impact our ability to execute our plan.
We designed our smart capital strategy to enable us to conservatively manage the day-to-day business to trend line growth while maintaining the operational flexibility to quickly and cost effectively capture upside when it comes.
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2024 Q2
5 Aug 24
expect some level of softening there in those in the networking area
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2022 Q4
27 Jan 23
we have more exposure to enterprise in Chi
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2022 Q4
27 Jan 23
We're a high fixed cost model
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2022 Q4
27 Jan 23
I think as you heard from Microsoft, PC usage is up, , the number of hours per PC continues to be up. The installed base has gone up.
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2022 Q4
27 Jan 23
The other thing is, in the first quarter, we're going to have about a 400 basis point impact on our gross margins just from under loading, because of the demand softness
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2022 Q4
27 Jan 23
Operating loss was $441 million, down $63 million sequentially, with inventory valuations negatively impacted by softer demand, especially for crypto processors
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2022 Q4
27 Jan 23
ustomer inventory remains elevated beyond our previous expectations and will continue to burn into the first half of 2023.
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2022 Q4
27 Jan 23
increased inventory reserves
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2022 Q4
27 Jan 23
Our ambitions are equal by our passion, and our efforts across manufacturing, design, products and foundry are well on their way to driving our transformation and creating the flywheel, which is IBM 2.0.
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2022 Q4
27 Jan 23
We expect additional efficiencies as we implement our internal foundry model, which is a key element to accomplish our $8 billion to $10 billion of cost savings exiting 2025, as we outlined on our last call.
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2022 Q4
27 Jan 23
market forces impacting PCs and serve
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2022 Q4
27 Jan 23
Xeon portfolio is on track to launch in 2024,
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2022 Q4
27 Jan 23
Such as MediaTek, we now have lifetime deal value of greater than $4 billion for IFS.
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2022 Q4
27 Jan 23
will end future investments in our network switching product line,
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2022 Q4
27 Jan 23
This is in contrast to the semi market ex-memory, which third parties expect to decline low to mid-single digits.
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2022 Q4
27 Jan 23
declines in enterprise and Rest of World.
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2022 Q4
27 Jan 23
Given continued uncertainty and demand signals we see in Q1, we expect the lower end of that range is a more likely outcome.
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2022 Q4
27 Jan 23
To various degrees, all our markets are being impacted by macro uncertainty, rising interest rates, geopolitical tensions in Europe and COVID impacts in Asia, especially in China.
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2022 Q4
27 Jan 23
We expect macro weakness to persist at least through the first half of the year with the possibility of second half improvements.
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2022 Q4
27 Jan 23