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Intel cuts profit forecast after Thai floods disrupt chip plant production

Chipmaker Intel has cut sales and profits forecasts due to hard disk drive supply shortages following the floods in Thailand.

Chipmaker Intel has cut sales and profits forecasts due to hard disk drive supply shortages, following the floods...

in Thailand.

Intel cut sales estimate to $13.7bn (£8.38bn) for the fourth quarter, down from $14.7 billion. It also warned profit margins will be slightly lower, at about 64.5% rather than 65%. Intel is the world’s largest manufacturer of microprocessors.

The announcement follows floods in Thailand, where several computer manufacturing plants were disrupted.

“The worldwide PC supply chain is reducing inventories and microprocessor purchases as a result of hard disk drive supply shortages. The company expects hard disk drive supply shortages to continue into the first quarter, followed by a rebuilding of microprocessor inventories as supplies of hard disk drives recover during the first half of 2012,” said Intel.

Research firm iSuppli said it expects global PC shipments to total 84.2 million units in the first three months of 2012, down from a previous estimate of 88 million units.

Computer maker Dell also warned that flooding in Thailand is causing a worldwide shortage of PC hard drives that will last into the first quarter of 2012 and could affect the company’s revenues.

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