Intel gains with earnings and EU antitrust case in focus

• Intel shares gain after company wins competition case appeal

• $1.2 billion EU antitrust fine dropped

• Company to report earnings after session close

• Stock tests resistance zone below $52.50

Intel is on watch today as the company is set to report Q4 earnings after close of the session. Market expects the company to report lower sales and earnings compared to the year-ago quarter. Stock trades higher as positive news on the company arrived shortly before the start of the session today.

European court drops $1.2 billion antitrust fine

Just a few hours ahead of the earnings announcement for Q4 2021, positive news on Intel hit the markets. Company won an appeal in a decade-long antitrust case at the EU General Court. Case was brought up by an EU antitrust watchdog who said that Intel abused its dominant position to prevent rival AMD from competing. As a result, a $1.2 billion fine was dropped.

Q4 2021 earnings tonight!

Intel is on watch today mostly because it is set to report Q4 2021 earnings today after close of the session. Analysts expect the company to report lower revenue and lower earnings. Gross margin is also expected to be lower than in Q4 2020. Forecasts for Q1 2022 and full-2022 are also expected to point to lower sales and earnings. When it comes to commentary, attention will be on management views on supply chain situation and Intel's chip production. Market expectations

• Revenue: $18.33 billion vs $19.98 billion a year ago

  • Data Center Group revenue: $6.73 billion

  • Internet of Things revenue: $1.07 billion

  • Client Computing revenue: $9.56 billion

  • Non-Volatility Memory Solutions revenue: $1.08 billion

• Net Income: $3.72 billion vs $4.56 billion a year ago

• Adjusted EPS: $0.90 vs $1.11 a year ago

• Adjusted gross margin: 53.6% vs 56.8% a year ago

• Q1 2022 revenue forecast: $17.71 billion vs $18.56 billion

• Q1 2022 adjusted EPS forecast: $0.86 vs $1.19

Shares bounce off the trendline

Taking a look at Intel chart (INTC.US) at a daily interval, we can see that shares are trading 2% higher following news of a win in the EU antitrust case. Share price launched recovery earlier this week and has now reached a resistance zone ranging between 50% retracement of previous upward impulse and $52.50 handle. If bulls fail to break above, for example if earnings disappoint, a pullback towards recent low in the $50.25 area cannot be ruled out. Upward trendline and lower limit of market geometry can be found there.

Source: xStation5