Intel Q2 revenue to sink further than expected?

— 5:42 PM on June 6, 2006

EE Times cites a report from Handelsbanken Capital Markets Analyst Bruce Diesen, who claims Intel will announce another profit warning for the second quarter. Back in March, the company announced that its first quarter revenue would fall short of expectations. The same may now happen for Q2. Intel's revenue for the first quarter of this year turned out to be $8.9 billion, down from an expected $9.1-9.7 billion and 5% below last year's first quarter revenue of $9.4 billion. The company came to a consensus forecast of $8.4 billion for the second quarter, but Diesen says Intel is now expected to make only $7.9 billion. This figure would be down 14% from last year's $9.2 billion.

To blame for the poor expected results are Intel's shrinking sales and recent price cuts. Diesen says chip sales for April were down 52% from the same time frame last year, and that Intel has given up trying to make a profit for its current-generation chips. Indeed, the company's prices (PDF) have dropped dramatically since the first quarter. The Pentium D 950 cost $637 in January, for instance, and its list price for April was just $316—a 50% decrease in less than four months.

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