Feeds

Intel rides laptop chips and lower costs during Q2

Investors not impressed

Next gen security for virtualised datacentres

Strong notebook and server chip sales carried Intel to a second quarter that neared the high end of previous forecasts. Investors, however, seemed unmoved by the results, as Intel noted strong pricing competition in the desktop market and a reliance on cost-cutting measures to gloss its results.

Intel reported second quarter revenue of $8.7bn - an 8 per cent rise year-over-year. The revenue figure fits well within a previous forecast range, stretching between $8.2bn and $8.8bn. The chip maker's bottom line benefited from a workforce decimation, as net income came in at $1.3bn - a whopping 44 per cent higher than during the same period last year. Intel also posted earnings per share of 22 cents in the second quarter, which beat out last year's EPS figure by 47 per cent.

"We saw strength in the second quarter across the board - in all geographies and in all segments of the market," said CEO Paul Otellini, during a conference call with analysts.

Intel, however, enjoyed more strength in some segments than others.

Otellini flagged up a double-digit rise in server processor shipments year-over-year and a 20 per cent increase in mobile processor revenue as the quarter's highlights. Demand for desktop processors was higher than in past years, although Intel's revenue dropped due to a lower average selling price of its products.

"While demand for computers was strong, pricing remained competitive notably in the low-end of the PC marketplace," Otellini said.

Intel's flash memory business maintained its place as a quarter dampener with NOR sales coming in well below expectations. The lackluster flash shipments shaved one point off Intel's gross margin of 46.9 per cent.

The second quarter results were aided by lower R&D and marketing costs and by improved investment results.

During the quarter, Intel's server and PC chip business brought in $4.64bn in revenue, which compares to $4.62bn last year. The mobile chip business posted revenue of $3.30bn versus $2.69bn last year. And the flash business saw revenue drop to $494m from $536m last year. Intel is in the midst of creating a separate flash business in partnership with STMicroelectronics.

Overall, Intel portrayed the worldwide economy as "relatively strong" and expects third quarter revenues to come in between $9bn and $9.6bn - or about 6 per cent higher year-over-year.

The Intel Brass also noted that they expect the most pricing pressure versus AMD with low-end desktop chips and some notebook chips in the coming months. They claim the pricing pressure has eased a bit in the server market.

Shares of Intel dropped almost 5 per cent in the after-hours markets to $25.10, at the time of this report. ®

Secure remote control for conventional and virtual desktops

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
BBC: We're going to slip CODING into kids' TV
Pureed-carrot-in-ice cream C++ surprise
Twitter: La la la, we have not heard of any NUDE JLaw, Upton SELFIES
If there are any on our site it is not our fault as we are not a PUBLISHER
Facebook, Google and Instagram 'worse than drugs' says Miley Cyrus
Italian boffins agree with popette's theory that haters are the real wrecking balls
Sit tight, fanbois. Apple's '$400' wearable release slips into early 2015
Sources: time to put in plenty of clock-watching for' iWatch
Facebook to let stalkers unearth buried posts with mobe search
Prepare to HAUNT your pal's back catalogue
Ex-IBM CEO John Akers dies at 79
An era disrupted by the advent of the PC
prev story

Whitepapers

Endpoint data privacy in the cloud is easier than you think
Innovations in encryption and storage resolve issues of data privacy and key requirements for companies to look for in a solution.
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.
Advanced data protection for your virtualized environments
Find a natural fit for optimizing protection for the often resource-constrained data protection process found in virtual environments.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.