Semiconductor giant Intel has announced its first quarter income revenues for 2009 which have surpassed market expectations, prompting the company to declare that the worst of the recession was over.
Profits reached $647 million for the first quarter of this year, a massive slump from the $1.4 billion recorded last year. Revenues fell 26 percent to $7.1 billion for the first three months of 2009. Earnings per share reached 3 cents per share.
Intel will be particularly worried by its Atom platform where it currently doesn't face any competition. Revenues from this segment fell a whopping 27 percent to a mere $219 million. Netbooks are expected to be one of the very few growing segments in tech hardware, so the news must mean either that Intel had to slash prices or inventory is piling up due to slower demand,
But Intel has already confirmed that inventory has been reduced by a fifth compared to the last quarter. Intel's CEO, Paul Otellini, reckons that the worst is over saying that "Intel has adapted well to the current economic environment and we’re benefiting from disciplined execution and agility. We’re delivering a product portfolio that meets the needs of the changing market, spanning affordable computing to high-performance, energy-efficient computing."
But most importantly, he fell short of providing with a revenue estimate for the current quarter, putting the blame on "continued economic uncertainty and limited visibility". Intel is expected to spend around $10 billion worth in research and development in 2009 alone. The company has already announced since the beginning of the year that it will be shedding thousands of jobs and close plans around the world.
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Intel is currently down in after market trading by around 4 percent on fears that the downturn in technology could last much longer than Intel is hoping. The fall has slashed rival AMD share prices by a depressing 7 percent to $3.36.
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