Exhibit 99.3
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investor meeting
2015 SANTACLARA
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investor meeting
2015 SANTACLARA
Stacy Smith
Chief Financial Officer
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Key Message: Driving Shareholder Return
Data Center: Big and Delivering Growth
Client Computing enables critical IP blocks, profits, and cash flow
Internet of Things and Memory Delivering Growth
Insights into Investments, Cost and Capex
Disciplined Capital Allocation
3
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2015 Financial Results
Full Year
Revenue*
~$55.2B
Full Year
Gross Margin*
~62%
Full Year Operating
Profit Between**
$13.5—$14.0B
4 *2015 forecast is based on Q1-Q3 actuals plus the midpoint of Q4 Business Outlook as announced on October 13, 2015.
**Forecast range is based on current expectations given available information and is subject to change without notice .
Source: Intel
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GDP Forecasts for 2015
5 Forecast is based on current expectations given available information and is subject to change without notice.
Source: IHS, November 2014 and November 2015 Forecasts.
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Key Message: Driving Shareholder Return
Data Center: Big and Delivering Growth
Client Computing enables critical IP blocks, profits, and cash flow
Internet of Things and Memory Delivering Growth
Insights into Investments, Cost and Capex
Disciplined Capital Allocation
6
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Data Center Group
DCG Full Year Financials
YTD 2015 PERFORMANCE
$11.7B of Revenue:
Up 13% YoY
$5.7B Operating margin:
Up 11% YoY
49% of revenue
7
Source: Intel
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Data Center ~ CPU Revenue
HPC, Workstation,
Enterprise Server
Networking & Storage Cloud Server
14-15* growth:
Slightly down
14-15* growth:
~10%
14-15* growth:
>40%
8
*Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Data Center ~ CPU Revenue Mix
2013
9
Source: Intel
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Data Center ~ CPU Revenue MIX
10
*Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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DCG 2016 Expectations
Revenue growth in the mid-teens
Operating Profit growth
in the low double digits
11 Note: 2016 fiscal year has 53 work weeks.
Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Key Message: Driving Shareholder Return
Data Center: Big and Delivering Growth
Internet of Things and Memory Delivering Growth
Insights into Investments, Cost and Capex
Disciplined Capital Allocation
Client Computing enables critical IP blocks, profits, and cash flow
12
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PC TAM Forecast Changes For 2015
Forecast is based on current expectations given available information and is subject to change without notice. For comparison purposes, IDC data has been adjusted to align with Intel’s “PC” definition which includes detachables. IDC reported its current 2015 forecast (excluding detachables) as
-9% YoY. A year ago, IDC reported its 2015 forecast (excluding detachables) as -2%. There were no adjustments to Gartner’s forecasts.
13 Source: IDC and Gartner. “Current” forecasts for IDC and Gartner were released on Aug 20, 2015 and on Sept 17, 2015 respectively.
“A year ago” forecasts for IDC and Gartner were released on Aug 20, 2014 and on Sept 15, 2014 respectively.
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Client Computing Group
CCG Full Year Financials
YTD 2015 PERFORMANCE
~$23.5B of Revenue:
Down 10% YoY
~$5.4B Operating margin:
Down 27% YoY
~23% of revenue
14
Source: Intel
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PC ASP & Segmentation
2015 Core Mix**
>70%
at an all time high
15 *PC ASPs include both CPU and chipset and excludes netbook.
**Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Improving Mobile Profitability in CCG
On-track to exceed 2015 $800M Mobile* Profitability goal
~one-third from product margin improvements
~two-thirds from lower investment
Low Double Digit Operating Profit Growth** for CCG in 2016
includes ~$800M of mobile profitability improvements
~two-thirds product margin improvements
~one-third from lower investment
16 * Mobile products are part of the CCG segment.
**Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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2014 Strategy Recap
IP and Manufacturing
leadership are increasingly
valuable advantages
17
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2015 Client Computing Business
Generates FCF + Profits:
~$8B in operating profit
Gives us scale:
>80% of total units
Funds IP for use across the company:
>50% of Shared IP Originates from Client Investments
18
Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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CCG 2016 Expectations
PC Market projection: Slightly down,
vs. 3rd party projections of ~flat
CCG Revenue:
Flat to low single-digit growth
CCG Op Profit:
Growth in the low double digits
19 Note: 2016 fiscal year has 53 work weeks.
Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Key Message: Driving Shareholder Return
Internet of Things and Memory Delivering Growth
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IOTG, NSG and SSG delivering Revenue Growth
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| *Forecast is based on current expectations given available information and is subject to change without notice. |
Source: Intel
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Other Elements of our Portfolio
Internet of
Things Group
Software and
Services Group
Non-Volatile Memory
Solutions Group
Revenue Operating Margin
22 |
| *Forecast is based on current expectations given available information and is subject to change without notice. |
Source: Intel
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Key Message: Driving Shareholder Return
Insights into Investments, Cost and Capex
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2014 – 2016 Spending Shifts
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| This chart shows spending (R&D and MG&A) shifts from 2014 to 2016F. |
Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Capital Trends: 2012 – 2015
25 |
| *Forecast is based on current expectations given available information and is subject to change without notice. |
2015 forecast is based on the midpoint of Business Outlook as announced on October 13, 2015.
Source: Intel
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Capital Trends: 2012 – 2016
26 *Forecast is based on current expectations given available information and is subject to change without notice.
2015 forecast is based on the midpoint of Business Outlook as announced on October 13, 2015.
Source: Intel
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PC ASP and Cost Trends
27 PC ASPs and costs include both CPU and chipset and exclude netbook.
*Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Segmented Costs to Compete Across Segments
PC Costs*
*PC costs include both CPU and Chipset components and exclude netbook.
**Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Segmented Costs to Compete Across Segments
PC Costs*
*PC costs include both CPU and Chipset components and exclude netbook.
**Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Segmented Costs to Compete Across Segments
PC Costs*
*PC costs include both CPU and Chipset components and exclude netbook.
**Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Gross Margins
Gross Margin % Annual 2005-2016
*Forecast range is based on current expectations given available information and is subject to change without notice .
2015 forecast is based on the midpoint of Business Outlook as announced on October 13, 2015.
Source: Intel
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Gross margin Drivers
FY 2016 vs. FY 2015
10nm Start-up Costs
3D XPoint™ Ramp
Forecast is based on current expectations given available information and is subject to change without notice .
This gross margin walk is referencing Platform ASP and costs. Platform includes Client Computing Group,
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| Data Center Group, and Internet of Things Group microprocessors and chipsets |
Source: Intel
ASPCosts
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Key Message: Driving Shareholder Return
Disciplined Capital Allocation
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Strong Cash Generation
Cash from Operations Free Cash Flow
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| *Forecast is based on current expectations given available information and is subject to change without notice. |
Source: Intel
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Bringing Down Net Cash Levels
Net cash is a non-GAAP measure which is used to assess our sources of liquidity and capital resources. See the non-GAAP reconciliation on the “Explanation of Non-GAAP Net Cash” slide.
Source: Intel
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Investing and Returning Cash to Shareholders
First: Invest in our business
Second: Dividend
Third: Share Repurchases
36
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Share
Repurchase
R&D
Capital
Expenditure
37 Source: Intel
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Announcing Dividend Increase Starting in Q1 ‘16
38 *Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Putting It All Together ~ 2016 Full Year Outlook
Note: 2016 fiscal year has 53 work weeks
Revenue Growth in the Mid-Single Digits
Gross Margin at 62% plus or minus a couple points
Spending (R&D + MG&A)* as a percent of revenue down 1/2 point
Capital Spending at $10B, plus or minus $500M (includes ~$1.5B for Memory)
Dividend at $1.04 per share ($0.08 per share increase) effective Q1 ‘16
39 |
| Forecast is based on current expectations given available information and is subject to change without notice. |
*Spending includes estimated expenses for R&D and MG&A and excludes estimated amortization and restructuring expenses .
Source: Intel
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One More thing…
40
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Growth Portfolio ~ The Revenue Mix
41 *Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel
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Napkin Math ~ The Growth Model
Assumes DCG grows mid-teens
Note: model assumes IOTG + Memory + Software at historical growth
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Risk Factors
The statements in this presentation and other commentary that refer to future plans and expectations are forward-looking statements that involve a number of risks and uncertainties. Words such as “anticipates,” “expects,” “intends,” “goals,” “plans,” “believes,” “seeks,” “estimates,” “continues,” “may,” “will,” “should,” and variations of such words and similar expressions are intended to identify such forward-looking statements. Statements that refer to or are based on projections, uncertain events or assumptions also identify forward-looking statements. Many factors could affect Intel’s actual results, and variances from Intel’s current expectations regarding such factors could cause actual results to differ materially from those expressed in these forward-looking statements. Intel presently considers the following to be important factors that could cause actual results to differ materially from the company’s expectations. Demand for Intel’s products is highly variable and could differ from expectations due to factors including changes in business and economic conditions; consumer confidence or income levels; the introduction, availability and market acceptance of Intel’s products, products used together with Intel products and competitors’ products; competitive and pricing pressures, including actions taken by competitors; supply constraints and other disruptions affecting customers; changes in customer order patterns including order cancellations; and changes in the level of inventory at customers. Intel’s gross margin percentage could vary significantly from expectations based on capacity utilization; variations in inventory valuation, including variations related to the timing of qualifying products for sale; changes in revenue levels; segment product mix; the timing and execution of the manufacturing ramp and associated costs; excess or obsolete inventory; changes in unit costs; defects or disruptions in the supply of materials or resources; and product manufacturing quality/yields. Variations in gross margin may also be caused by the timing of Intel product introductions and related expenses, including marketing expenses, and Intel’s ability to respond quickly to technological developments and to introduce new products or incorporate new features into existing products, which may result in restructuring and asset impairment charges. Intel’s results could be affected by adverse economic, social, political and physical/infrastructure conditions in countries where Intel, its customers or its suppliers operate, including military conflict and other security risks, natural disasters, infrastructure disruptions, health concerns and fluctuations in currency exchange rates. Results may also be affected by the formal or informal imposition by countries of new or revised export and/or import and doing-business regulations, which could be changed without prior notice. Intel operates in highly competitive industries and its operations have high costs that are either fixed or difficult to reduce in the short term. The amount, timing and execution of Intel’s stock repurchase program could be affected by changes in Intel’s priorities for the use of cash, such as operational spending, capital spending, acquisitions, and as a result of changes to Intel’s cash flows or changes in tax laws. Product defects or errata (deviations from published specifications) may adversely impact our expenses, revenues and reputation. Intel’s results could be affected by litigation or regulatory matters involving intellectual property, stockholder, consumer, antitrust, disclosure and other issues. An unfavorable ruling could include monetary damages or an injunction prohibiting Intel from manufacturing or selling one or more products, precluding particular business practices, impacting Intel’s ability to design its products, or requiring other remedies such as compulsory licensing of intellectual property. Intel’s results may be affected by the timing of closing of acquisitions, divestitures and other significant transactions. In addition, risks associated with our pending acquisition of Altera are described in the “Forward Looking Statements” paragraph of Intel’s press release dated June 1, 2015, which risk factors are incorporated by reference herein. A detailed discussion of these and other factors that could affect Intel’s results is included in Intel’s SEC filings, including the company’s most recent reports on Form 10-Q, Form 10-K and earnings release.
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investor meeting
2015 SANTA CLARA
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EXPLANATION OF NON-GAAP NET CASH
The accompanying 2015 Investor Meeting materials contains references to non-GAAP financial measures of net cash, which is used by management when assessing our sources of liquidity and capital resources. We believe this non-GAAP financial measure is helpful to investors in understanding our capital structure and how we manage our resources. This non-GAAP financial measure should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations from these results should be carefully evaluated.
(In Millions) Sep 26, Dec 27, Dec 28, Dec 29, Dec 31, Dec 25,
2015 2014 2013 2012 2011 2010
GAAP CASH AND CASH EQUIVALENTS $ 7,065 $ 2,561 $ 5,674 $ 8,478 $ 5,065 $ 5,498
Short-term investments 7,119 2,430 5,972 3,999 5,181 11,294
Trading assets 6,659 9,063 8,441 5,685 4,591 5,093
Total cash investments $ 20,843 $ 14,054 $ 20,087 $ 18,162 $ 14,837 $ 21,885
Short-term debt (1,129) (1,596) (281) (312) (247) (38)
Net unsettled trade liabilities and other (200) (77) (113) (469) (30) (103)
Long-term debt (20,059) (12,059) (13,104) (13,070) (7,048) (2,059)
NON-GAAP NET CASH (excluding other longer term investments) $ (545) $ 322 $ 6,589 $ 4,311 $ 7,512 $ 19,685
GAAP OTHER LONG-TERM INVESTMENTS $ 1,829 $ 2,023 $ 1,473 $ 493 $ 889 $ 3,026
Loans receivable and other 1,191 1,335 1,270 1,065 1,082 1,015
Reverse repurchase agreements 2,650 450 400 50 ——
NON-GAAP OTHER LONGER TERM INVESTMENTS $ 5,670 $ 3,808 $ 3,143 $ 1,608 $ 1,971 $ 4,041
NON-GAAP NET CASH (including other longer term investments) $ 5,125 $ 4,130 $ 9,732 $ 5,919 $ 9,483 $ 23,726
Source: Intel
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EXPLANATION OF NON-GAAP CONSTANT CURRENCY
The 2015 Investor Meeting commentary contained references to non-GAAP financial measures of aggregated “software and services operating segments” net revenue and operating income on a constant currency basis. Constant currency results assume foreign revenues are translated from foreign currencies to the U.S. dollar, net of the effect of foreign currency hedges, at rates consistent with those in the comparable period. We believe this non-GAAP financial measure is helpful to investors in understanding our operating results of the aggregated “software and services operating segments”. This non-GAAP financial measure should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations from these results should be carefully evaluated.
(In Millions) Dec 26, Dec 27,
2015* 2014
SOFTWARE & SERVICES OPERATING SEGMENTS
GAAP NET REVENUE $ 2,152 $ 2,216
Constant currency adjustment 162 -
NON-GAAP NET REVENUE, constant currency adjusted $ 2,314 $ 2,216
GAAP OPERATING INCOME $ 219 $ 81
Constant currency adjustment 76 -
NON-GAAP OPERATING INCOME, constant currency adjusted $ 295 $ 81
*Forecast is based on current expectations given available information and is subject to change without notice.
Source: Intel