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Intel profits up as PC market improves

Intel said the PC market is on the way up after posting the strongest first to second quarter revenue growth for more than two decades.

Intel said the PC market is on the way up after posting the strongest first to second quarter revenue growth for more than two decades.

Sales went up 12% sequentially to $8bn but fell 14.6% year-on-year from $9.4bn while the company swung into net losses of $398m when the EU's $1.45bn anti-trust fine was factored into the results.

"Intel's second-quarter results reflect improving conditions in the PC market segment with our strongest first to second quarter growth since 1988 and a clear expectation for a seasonally stronger second half," said Paul Otellini, Intel CEO.

In a conference call with analysts, the chip giant said PC vendors has run down inventories in the first quarter - when Intel has claimed the market had bottomed out - and were now replenishing stocks in preparation for an upturn in the second half.

"Our customers signalled increased confidence for a seasonal second half with their ordering patterns. I believe this reflects how critical personal and enterprise computing has become to the world," said Paul Otellini.

Despite this, inventories at Intel were down $240m in the second quarter compared to a year ago, while restructuring and asset impairment charges were ahead of the company's expectations at $91m.

Microprocessor unit shipments were higher quarter-on-quarter it said, but ASPs were down and net losses from equity investments and interest were $38m.

Revenues are forecast in the region of $8.5bn for the next quarter, plus or minus $400m. Asset and impairment restructuring charges are estimated to be roughly $40m.

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