China, Indonesia Led Asian PC Sales Higher in Q2, Intel Says

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Stronger PC demand from consumers in China and Southeast Asia, particularly Indonesia, gave Intel's Asian business a boost during the second quarter, the company said Wednesday.

"It reflects the strength in Asia relative to the rest of the world, particularly China and Southeast Asia. Both of them look pretty good in terms of PC consumption," said Navin Shenoy, vice president of Intel's sales and marketing group and general manager of the company's Asia-Pacific operations.

Intel reported second-quarter revenue in Asia of US$4.4 billion, down 8 percent from $4.8 billion during the same period last year. But revenue from the region was up 21 percent over the first quarter of this year, a sequential increase of $762 million. That helped to raise the percentage of Intel's second-quarter revenue that came from Asia to 55 percent, from 51 percent last year.

Overall, Intel reported a net loss for the period of $398 million on worldwide revenue of $8 billion. The company's results were dragged into the red by a one-time $1.4 billion antitrust fine levied by the European Commission in May.

While Asian sales outperformed demand from other geographical regions, not all of the chips sold in Asia end up in the hands of Asian users. Asia is home to most of the world's largest computer hardware makers, and Intel chips sold in Asia are often used to manufacture computers that are shipped to customers in other parts of the world. Still, demand for computers from Asian consumers was relatively strong during the second quarter.

"As I look around the region, I see relatively stronger PC sales in China and Southeast Asia than in other parts of the world," Shenoy said, adding that consumer PC sales in these markets are also higher than they were during the same period last year.

"Indonesia is probably the strongest out of all the countries in Southeast Asia," he said, adding that all of the countries in that part of Asia are seeing growing demand for PCs from consumers.

Looking ahead, Shenoy expects Asian PC sales to rise higher during the third quarter, but stopped short of declaring a recovery.

"Our forecast for the third quarter is for it to be seasonally up on the second quarter. That reflects a return to normal seasonal patterns, but that's as far as I would go at this point," Shenoy said.

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