Intel Profit Rises 59%
NEW YORK (Dow Jones) – Intel Corp. ‘s (INTC) third-quarter profit rose 59% increase in business spending on new technology eased the pressure of weak consumer demand for personal computers.The Silicon Valley giant has seen its revenue and profits surge in recent quarters, thanks to the growing demand for its semiconductors. Tuesday, Intel reported more than $ 11 billion in quarterly revenues for the first time.CFO Stacy Smith attributed the results to a market “robust” of the company, citing an ongoing upgrade of the technology business, but he called the consumer market “weaker than expected,” a point the company recognized in August when he got out of third-quarter estimates. Smith believes that the continuing trends in the fourth quarter.“We see a growth in the consumer segment, but what we’re predicting a little less growth than expected in the fourth quarter,” said Smith. He attributed the weakness of consumers in the third and fourth quarters of economic uncertainty and customers to reduce inventory before the new computer chip from Intel in the first quarter.Chief executive Paul Otellini said at a news conference that the company’s anticipated demand for the new chip, known as Sandy Bridge, is “much higher” than initially expected, and the company expects a “very fast ramp.Meanwhile, Smith said that while tablets is likely damage to sales of netbooks a bit, that trend could not drive gently on the results of Intel’s customers in the third quarter.Intel has been notably absent in the compressed s market dominated by Apple Inc. (AAPL) IPAD, but Otellini said Intel’s momentum in the successful design is strong and the company expects “broad and profitable participation in Tablet PC market. He also said Apple has done a “wonderful” work to reinvent the tablets and category ultimately be added to the bottom line of Intel.In this regard, Intel called netbook on the market matures.revenue for the third quarter of Intel rose 18% to the top of its forecast down from August, and the midpoint of Intel’s projected fourth-quarter revenue slightly exceeded analysts’ expectations.In addition, Intel said its gross margin by line, which tends to drive the company’s shares, rose to 65.9% in the third quarter from 57.6% a year ago, according to its forecast August fell 65% to 67%. It also provides the margins of the fourth quarter from 65% to 69%, compared with analyst expectations of 66.1%.“When you take a look at your phone in the fourth quarter, better than most of us expected,” said analyst Patrick Wang at Wedbush But he cautioned that there are still some risks to Intel. “If demand does not materialize in the fourth quarter, we could see a modest inventory building could result in anther round of cuts number.”Intel shares, down from 3.1% in 2010, up 0.8% to $ 19.92 in after-hours trading.Intel, which makes chips that run 80% of the world’s computers, is the first major high-tech company to report earnings this quarter, and serves as a benchmark for technology spending.The company used its strong cash position in the third quarter to make two major acquisitions, the security software company McAfee Inc. (MFE) and the wireless assets of Infineon Technologies AG (IFNNY, IFX.XE), to to expand beyond its computer business.Smith said at a news conference the company that procurement is expected to close later this year or first quarter, and purchases should reduce earnings slightly in the first year of operations and be a little flat earnings in the second year.He added that Intel is not contemplating large purchases.In the third quarter, Intel reported earnings of $ 2.96 billion, or 52 cents per share, compared with earnings a year ago of $ 1.86 billion, or 33 cents per share, above the analysts’ average estimate of 50 cents per share. Intel tax rate was 30.5%, slightly below the company’s expectations of about 32%.Revenues were $ 11.1 billion. The company warned in late August that it expected revenue of $ 10.8 million to 11.2 billion U.S. dollars, down from its previous estimate of $ 11.2 million to $ 12 billion. Revenue grew in all regions except Europe, where he scored 0.2%.Intel’s sales to its PC customers grew 14% from a year ago to $ 8.1 billion. The company said customers continued to manage inventory at healthy levels. Group Intel data centers, which had record sales of server chips, saw its third-quarter revenue increased 30% from a year ago to $ 2.2 billion.Chips for servers, because they cost more than PC models have a strong effect on average selling prices of Intel, the company remained until the second quarter, but significantly over the previous year.For the fourth quarter, Intel expects revenues of between $ 11 billion and $ 11.8 billion, with the midpoint of $ 11.4 billion, above the average estimate of analysts polled by Thomson Reuters of 11 320 million dollars.