SAN FRANCISCO - Intel Corp., the world's largest chip maker, on Tuesday reported a rise in quarterly profit as revenue reached the second-highest level in the company's history, helped by strong demand for its Centrino notebook computer chips.
The bellwether report, which came in at the top end of Intel's
previous target, led the shares up in after-hours trading.
Net income in the first quarter ended April 2 rose to US$2.2 billion ($3.1 billion), or 34 cents a share, compared with a year-earlier profit of US$1.7 billion, or 26 cents a share. Sales rose to US$9.4 billion from US$8.1 billion, slightly below the all-time company record of US$9.6 billion set in the fourth quarter of 2004.
The results from the Santa Clara, California-based company topped the average Wall Street expectation of a profit of 31 cents a share on sales of US$9.31 billion, according to a poll of analysts by Reuters Estimates.
Intel shares rose 3.6 per cent to US$23.45 in after-hours action following the news, which came after the close of regular session trading. That built on a 1.9 per cent gain on Nasdaq ahead of the report.
Intel said it expected revenue in the second quarter to be in a range of US$8.6 billion to US$9.2 billion, in line with the average analyst expectation of US$8.9 billion. Gross profit margin, the percentage of sales left over after accounting for production costs, was forecast to be about 56 per cent, plus or minus a couple of points.
The first-quarter report came in at the top end of an upbeat financial forecast Intel gave on March 10. At the time, Chief Financial Officer Andy Bryant bumped up the company's revenue and profitability targets after Intel's manufacturing plants scrambled to meet demand for notebook computer chips.
Helped by the popularity of its Centrino brand of chips for notebook PCs, Intel's share of the market for PC microprocessors rose by about 1 percentage point last year to 81.5 per cent, while rival Advanced Micro Devices Inc. saw its share slip by about a point to around 16 per cent.
At the same time, the chip maker faces several challenges, including AMD's Opteron chip for business computers, a recent reorganisation of the company, and an upcoming transition to a new chief executive officer.
- REUTERS
