Intel hauls in $11 billion in a quarter

Intel's revenue exceeded $11 billion in a quarter for the first time ever, in results just released for Q3 2010.

Sales were up 18 per cent year-over-year to $11.1 billion, the chip maker said. It made $3 billion profit.

CEO Paul Otellini said microprocessor revenue was up, a "healthy" 25 per cent year-over-year, "due in large part to the strong demand for higher-end offerings in our product lineup. We exit Q3 firmly on track to deliver our best year ever and this is something we are all very proud of."

Intel enjoyed record sales of mobile and server processors. Revenue was up three per cent across its PC client and data-centre business groups.

The firm's gross margin held at 67 per cent, plus or minus a couple percentage points, the firm said.

In an earnings call, Otellini said demand for Westmere and Nehalem-EX processors drove server microprocessor revenue up over 30 per cent year-over-year. "Shipments into the cloud segment are up a very strong, up 200 per cent from a year ago and up 50 per cent from just last quarter," he said, adding that the firm's storage business "is up 29 per cent year-over-year, emphasising that the Xeon product family is not just for servers but it has become an important brand in the data centre."

The announcement also revealed that revenue from its Atom processor line slipped by four per cent since the previous quarter.

It could get worse, Otellini acknowledged, tipping his hat in the direction of Apple. "We think tablets are exciting and we fully welcome their arrival," he claimed. "Apple has done a wonderful job reinventing the category. We believe that like netbooks, tablets will expand the term for computing overall with a new form factor and new uses that bring computing to even more aspects of our lives.

"Will they impact PC sales? Sure. At the margin, they probably will, Otellini said. "Consumers will have a limited amount of discretionary income and some will choose to purchase a tablet instead of upgrading at existing PC or purchasing a netbook in any given period."

Despite this 'marginal' inconvenience, Intel expects its Q4 to be similar, predicting revenue in the $11-11.8 billion range with a gross margin of 65-69 per cent, keeping it on track for another record-breaking financial year.