Price cuts may hit Intel CPUs soon


— 3:18 PM on January 14, 2009

Intel's financial woes and the slumping economy could have some positive aspects for CPU shoppers. According to eWeek, Intel seems likely to slash processor prices after it announces fourth-quarter financial results this week.

eWeek quotes Technology Business Research analyst John Spooner, who says slowing demand (not to mention the Core i7 launch) could have left Intel with an overgrown stock of 45nm Core 2 processors: "Intel is going to have a significantly larger amount of inventory on hand than it expected to and that's going to be a big problem going into 2009. . . . Does Intel [throttle] back the factories and lose money that way or does it make lots of chips and put them in inventory and lose money by having to discount them?" Spooner believes the chipmaker will choose the latter option.

Intel originally expected fourth-quarter sales to add up to $10.1-10.9 billion. In November, the company reduced that estimation to $9 billion (give or take $300 million), and it revealed last week that Q4 revenue actually worked out to around $8.2 billion—a 23% year-over-year drop—because of weak demand.

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