Feeds

Intel confirms major chip shortages

$8bn financials boosted by VC activities

  • alert
  • submit to reddit

The essential guide to IT transformation

Demand exceeded supply for Intel microprocessors in the first half of this year, and that has led to an uncomfortable shortage of chips, CEO Craig Barrett conceded yesterday as the firm reported its Q1 financial results. That is leading Intel to spend more money investing in increased fab capacity, Barrett said. "While supply remains tight entering the second quarter, we are ramping our .18 micron manufacturing technology rapidly in five facilities, and expanding to eight facilities by year-end, which will substantially increase supply in the coming quarters. We are excited about our product introductions slated for the second half, when we will refresh our entire microprocessor line." Barrett claimed that Intel will have eight .18 micron fabs running by the end of 2000. Last week, as reported here, Intel notified many of its PC customers that they would have supply constraints until June or July, and those would be particularly tight for processor speeds of 700MHz and above. The firm's turnover rose to $8 billion in its Q1, a 13 per cent increase year on year, but a two per cent drop compared to the last financial quarter it reported. Net profit for the Q amounted to $3.1 billion, a rise of 52 per cent year on year, and 28 per cent higher than its last quarter. However, a slab of this impressive profit figure arose from Intel venture capital activities. The firm, over the last two years, has built up its Intel Capital portfolio. There are also tax advantages built into the figures. Barrett predicted that revenues and gross margins will be flat or even down a point or so for its next financial quarter, as a result of it "ramping" more .18 micron facilities. Nevertheless, many companies would give their eye teeth and much more for the gross margin of around 60 per cent expected for the next quarter. However high the gross margins, and however big the contributions made by Intel Capital, the company is finding it harder to disguise the fact that there have been problems supplying Coppermine processors since launch date on 25 October. Further, Intel has committed to major product launches during the second half of the year, potentially compounding its problems. At February's Intel Developer Forum, senior executives at the firm were predicting that the tightness in supplies would be over by the end of March. Its biggest launch this year will be of the Itanium 64-bit microprocessor, but it has also said it will introduce a low-cost system on a chip part, codenamed Timna, as well as Willamette and Foster, two high end IA-32 microprocessors. ® Related Story Intel CuMine supply problems a twisted complex tale Disaster hits Intel Coppermine supplies

5 things you didn’t know about cloud backup

More from The Register

next story
Microsoft exits climate denier lobby group
ALEC will have to do without Redmond, it seems
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
True fact: 1 in 4 Brits are now TERRORISTS
YouGov poll reveals terrible truth about the enemy within
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
7 Elements of Radically Simple OS Migration
Avoid the typical headaches of OS migration during your next project by learning about 7 elements of radically simple OS migration.
BYOD's dark side: Data protection
An endpoint data protection solution that adds value to the user and the organization so it can protect itself from data loss as well as leverage corporate data.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?