Intel makes modest profit

Mixed bag

Intel has met analyst expectations with first quarter results that give rise to hope that the worst of the IT downturn is now behind it.

The chipmakers Q1 net income was $936 million, up 86 per cent sequentially and 93 per cent year-over-year, on sales of $6.8 billion, down 3 per cent from its last quarter. Net income excluding acquisition-related costs of $111 million was $1.0 billion, up 2 per cent sequentially and down 7 per cent year-over-year.

Intel took a $155 million Q1 charge related to the settlement of a patent infringement lawsuit brought by Intergraph. Under the terms of a $300 million deal, announced yesterday, the companies signed a cross-licensing agreement, and ownership of various patents was transferred to Intel.

Intel's results continued to be affected by weak IT spending, particularly in the US and Europe

Ethernet connectivity products and motherboard shipment were up during the quarter and microprocessor shipments were flat. Chipset unit shipments and flash memory sales were both down over the quarter.

Looking ahead, Intel expects Q2 sales to come in at between $6.4-7 billion. ®