Intel unveils first quarter financial results
Intel has announced
its financial results for the first quarter of this year, reporting revenue
of $8.9 billion, operating income of $1.7 billion, and net
income of $1.3 billion. Those are down 5%, 44% and 38% from last year's
first quarter results, respectively, and a 12%, 49% and 45% drop from the last
quarter. Gross margin was 55.1% for this quarter, compared to
59.3% and 61.8% for last year's first and fourth quarters. Intel says
the low margin was due to "lower microprocessor revenue and higher
inventory write-downs." Regarding the other disappointing results, Intel
CEO Paul Otellini claims:
"We believe PC growth rates have moderated over the course of the past
few quarters, leading to slower chip-level inventory reductions at our
customers and affecting our revenue in the first half of the year."
Naturally, Otellini stresses the upcoming third quarter launch of
new Core-based chips, including Conroe, which he says will give Intel
"performance leadership across the server, desktop and mobile segments."
He also touts "excellent operational progress," along with good market
penetration of the new Centrino Duo and Viiv platforms. However, Intel's second quarter
outlook is still grim, with expected revenues of $8.0-8.6 billion and 49% gross margin—down from last year's $9.2 billion and 56.4%
for the second quarter.
In contrast to Intel's troubles, AMD boasted stellar first quarter results last week.
Its net sales were up 70.5% from the same time frame last year, and
operating income rose by an impressive 304.7%. Gross margin also
increased to 58.5%, up from 52.7% a year ago. AMD does nonetheless
expect similarly poor second quarter results, with sales due to be "flat
to slightly down" from this quarter.