Intel Corporation (INTC): Q3 Earnings Watch

intelDavid Zeiler: When Intel Corporation (NASDAQ:INTC) reports its third-quarter earnings after the market close today (Tuesday), the world’s largest chipmaker should get a boost from the improving PC market.

The Q3 INTC earnings will also tell investors whether Santa Clara, Calif.-based Intel has been able to make any headway in its lagging mobile business. In addition, we’ll learn whether its one-year-old Internet of Things initiative is still on track.

Here’s what investors need to know about the Q3 Intel earnings:

What to Watch for in the INTC Earnings for Q3

The Numbers: The consensus for earnings per share (EPS) is $0.65, up from $0.58 in the same quarter a year ago. Revenue is expected to come in at $14.45 billion, up from $13.5 billion last year.

The History: Last time INTC posted a beat, earning $0.55 a share versus expectations of $0.52. Revenue was $13.83 billion versus expectations of $13.69 billion. Gross margins grew from 59.6% to 64.5% over the previous quarter.

The Stock: Intel stock is up nearly 39% over the past 12 months and more than 25% year to date, despite the recent market drop. INTC stock closed at $31.47 on Monday. The average one-year target price is $35.

The Background: Long the beneficiary of the boom in PCs from the 1980s through the end of the 1990s, INTC has struggled as consumer tastes have shifted to mobile devices. In recent years, Intel has sought to fight back by focusing on tailoring chips for mobile devices as well as the Internet of Things.

The Keys to the Quarter: Investors will be looking hard at Intel’s mobile results, which were awful in the previous two quarters. Mobile Group revenue was down 61% year over year in the company’s first quarter, and down 83% year over year in the second quarter. However, a deal Intel made in May with Chinese semiconductor company Rockchip could pay off in this quarter.

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