Intel's quarterly profit nearly quadruples

10:12, April 14, 2010      

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Intel Corp. on Tuesday reported that its profit in the most recent quarter nearly quadrupled from a year ago, which are seen as reflections of growing computer market demands and recovery in information technology (IT) spending.

In the three months ended on March 27 this year, Intel posted net income of 2.44 billion U.S. dollars or 43 cents a share, compared with 629 million dollars or 11 cents a share in the same period the previous year.

Revenues also jumped 44 percent over the year-ago quarter to 10. 3 billion dollars, said the world's largest computer chip maker.

Numbers of profit and sales both beat Wall Street's estimates. According to Bloomberg, analysts had projected earnings of 38 cents a share on sales of 9.85 billion dollars.

"The investments we're making in leading edge technology are delivering the most compelling product line-up in our history," Paul Otellini, Intel's chief executive officer, said in a statement.

"These leadership products combined with growing worldwide demand and continued outstanding execution resulted in Intel's best first quarter ever," he added.

Looking forward, Intel expects sales in the current quarter to be in the range of 9.8 billion dollars to 10.6 billion dollars, above analysts' average estimate of 9.7 billion dollars.

Intel is a kind of barometer for the technology industry as it holds a share of more than 80 percent in the global microprocessor market. The chip maker is the first major technology company to release results in the first quarter of 2010.

Analysts believed that Intel's performance in the most recent quarter embodies some general trends in the overall semiconductor and technology industry.

Chip makers now are more profitable than any time in the last decade, reflecting the industry's increasingly aggressive management of costs, capacity and competitive positioning, according to analysts at research firm iSuppli.

The reason that the semiconductor market showed unusually year- over-year strength in the first quarter of 2010, is in part due to catastrophic economic conditions early in 2009, they noted.

"After a poor 2009, the global PC (personal computer) and microprocessor businesses are continuing to return to a state of normality in the first quarter of 2010," Matthew Wilkins, principal analyst of compute platforms for iSuppli, said in a statement on Tuesday.

Chip sales in the first quarter are driven by continuing strong sales growth of notebook PCs and the overall computer market is expected to benefit further from the return of corporate spending in 2010, Wilkins said.

After declining 4.5 percent last year, global IT spending will grow 5.3 percent to 3.4 trillion dollars in 2010, research firm Gartner projected on Monday.

In addition to robust consumer spending on mobile PCs, enterprise hardware spending is expected to grow again in 2010 though remain below 2008 level, Gartner said.



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