NEW YORK (TheStreet) -- Intel has been the beneficiary of a resurgent PC market. As the company expands putting its chipsets into various devices, including wearable technology, the future for world's largest chipmaker seems brighter than it's been in a while. Intel reports fourth-quarter earnings Thursday. Intel's third-quarter earnings were reported in October. Then, Intel's largest division, the PC Client Group, generated $9.2 billion in revenue, while the Data Center Group generated $3.7 billion in revenue, Internet of Things contributed $530 million and the Mobile and Communications Group had $1 million in revenue, down 98% year over year. On the earnings call, Intel noted it's taking away some PC share from AMD , helping to keep gross margins strong. Gross margins in the third quarter were 65%, as the company earned 66 cents a share on revenue of $14.6 billion in the quarter. Must Read: Drones Are Coming Analysts surveyed by Thomson Reuters expect the company to earn 66 cents a share on $14.71 billion in revenue in the fourth quarter. When Intel reported third quarter revenue in October 2014, it said it expected revenue of $14.7 billion, plus or minus $500 million, with gross margins expects to be 64%, plus or minus a couple of hundred basis points. In a September interview with TheStreet, Intel Executive Vice President and CFO Stacy Smith noted the company has been able to boost its buyback program recently. Intel has returned more than $40 billion in cash to shareholders through buybacks and dividends over the past few years. That's due in large part to having superior products at premium prices, compared to the rest of the industry. Smith also mentioned why Intel has been able to keep gross margins high -- to the tune of around 60% -- as the PC business muddles along beside mobile devices. Smith referrred to the company's McAfee purchase a few years ago, and said that allowed Intel's chips to be more secure than other chipsets. Though shares have gained 42.4% over the past year, trouncing the broader markets, it hasn't been all roses for Intel. Since CEO Brian Krzanich took over for Paul Otellini, the company's position in mobile has gotten worse, despite advancements in chipsets, including the Silvermont series. In the third quarter, revenue from the Mobile and Communications Group was a paltry $1 million, with operating losses of $1.04 billion. It's clear that Intel is not seeing any significant design wins in mobile devices, but the company is working on expanding beyond just smartphones and tablets. The recent acquisition of Basis Science, the makers of a popular smartwatch, should help Intel move into wearable technology. Here's what analysts had to say about the quarter. Must Read: How Intel Wants to Be More Than Just a Chip Company Wedbush Securities analyst Betsy Van Hees (Neutral, $36 price target) "INTC guided Q4 revenue to $14.7B +/- $500MM (down -2% to up 4% Q/Q) which, at the midpoint (up 1% Q/Q), was in line with typical seasonality. Gartner recently reported Q4 PC shipments of 83.75B, up 4.1% Q/Q and 1.0% Y/Y, from 80.47B and 82.93B, respectively, which we expect will drive PCCG revenue to $9.28B. We also expect record revenue of $3.81B in DCG driven by strong demand from (1) cloud, (2) service providers, (2) NFV/SDN bolstered by recent acquisitions of Avago's Axxia networking assets (formerly LSI), and (4) High-Performance Computing (HPC). We believe another consecutive quarter of growth in PCs, robust Q/Q strength in data center, better product mix, and tight control of OpEx to push Q4 result to GAAP EPS of $0.68 on revenue of $14.81B, slightly above Street estimates of GAAP EPS of $0.66 on revenue of $14.69B." Wells Fargo analyst David Wong (Outperform, $40-50 price target) "We think that Intel should be able to meet, or beat, the midpoint of its guidance for 1% sequential sales growth. Monthly sales report from Taiwanese notebook ODMs Compal, Wistron, Quanta and Inventec indicate Taiwanese notebook ODM sales grew 8% sequentially and 6% year over year in the December quarter. Our composite of Taiwanese motherboard/computer makers (Asustek, Elitegroup, ASROCK, Microstar and Gigabyte, excluding Pegatron, which we think was distorted by Apple -related builds) showed 8% sequential growth and was up 3% year over year in the December quarter." Jefferies analyst Mark Lipacis (Buy, $50 price target) "Positive PC & server trends suggest 4Q14 and 1Q15 consensus estimates are too low. Media reports of TSMC share loss to Samsung are consistent with our Moore Stress thesis that INTC and Samsung remain the last two leading edge semi manufacturers standing, and opens the door for INTC to take share in mobile processors as 1) a foundry supplier to TSMC's customers, or 2) direct supplier to OEMs. We raise our price target to $50 -- INTC remains a top pick." --Written by Chris Ciaccia in New York >Contact by Email. Follow @Chris_Ciaccia // 0;if(!d.getElementById(id)){js=d.createElement(s);js.id=id;js.src="//platform.twitter.com/widgets.js";fjs.parentNode.insertBefore(js,fjs);}}(document,"script","twitter-wjs"); // ]]>
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