Intel Earnings Up, Future Uncertain
Despite the ongoing financial crisis that is weighing down some tech companies, Intel earnings were up in the third quarter, narrowly beating analyst expectations.
Net income for the quarter was US$2 billion, or $0.35 per share, up from $1.8 billion, or $0.30 per share, in the same period last year. Analysts polled by Thomson Financial had expected $0.34 per share.
Intel's net revenue was $10.2 billion. Sales in both its microprocessor and chipset units drove revenue for the quarter, which ended Sept. 27.
The third quarter was the first full period in which Intel sold its Atom microprocessors and chipsets for low-cost PCs, and sales of the chips brought down the average selling price of microprocessors for Intel. Overall, the average selling price was lower sequentially, but excluding Atom shipments, the average stayed flat, Intel said.
The results included a number of charges, such as an impairment charge for the Numonyx investment and a restructuring charge.
Intel warned that it is difficult to know how the current economic environment may affect its business in the coming months. The chip giant plans to release a mid-quarter business update on Dec. 4. But for now, it is expecting revenue for the fourth quarter to be between $10.1 billion and $10.9 billion. The fourth quarter will include a charge related to the recent decision by Intel and Micron to close their joint production of NAND flash memory from an Idaho facility.
Intel's results come just a week after competitor AMD said it plans to split into two companies, one to design chips and one to make them, in an effort to compete more effectively with Intel. AMD, which plans to release its third-quarter earnings report on Thursday, has reported losses in the past seven quarters.