Intel Corp. CEO Paul Otellini said PC sales have “bottomed out” and the company is forecasting revenue for the second quarter to be flat when compared to the first.
The announcement comes as Santa Clara-based Intel’s (NASDAQ: INTC) earnings dropped 55 percent year-over-year on lower sales. The company reported first-quarter revenue of $7.1 billion, compared to the year-ago quarter's $9.7 billion. It also had operating income of $670 million, net income of $647 million and earnings per share of 11 cents.
Analysts expected, on average, earnings of 3 cents a share on revenue of $6.98 billion, with some even expecting a loss.
But it was Otellini's comments indicating a possible recovery in PC sales that was most highlighted by industry observers.
“We believe PC sales bottomed out during the first quarter and that the industry is returning to normal seasonal patterns," said Otellini, in a statement. “Intel has adapted well to the current economic environment and we’re benefiting from disciplined execution and agility. We’re delivering a product portfolio that meets the needs of the changing market, spanning affordable computing to high-performance, energy-efficient computing."
However, the company deviated from past practices and did not issue a revenue projection, saying in a statement, "Due to continued economic uncertainty and limited visibility, Intel is not providing a revenue outlook at this time. For internal purposes, the company is currently planning for revenue approximately flat to the first quarter."
Restructuring and asset impairment charges were $74 million, lower than the expectation of $160 million; the company's quarterly net loss from equity investments and interest and other was $18 million, lower than the expectation of a $130-million loss.
Looking ahead, Intel said it expects R&D spending in 2009 to reach $10.4 billion to $10.6 billion.
http://www.bizjournals.com/dayton/stories/2009/04/13/daily40.html
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