Intel profit dips as PC and server chip sales decline

17.04.2012
Intel on Tuesday reported its first-quarter earning results for fiscal 2012, with profit dropping on a slowdown in PC and server chip sales.

Intel's net profit was US$2.7 billion for the first quarter ending on March 31, a drop from the net profit of $3.16 billion during the same quarter in the previous fiscal year. Excluding one-time items, however, Intel earned $2.9 billion and basic earnings per share were $0.56, while analysts polled by Thomson Reuters forecast EPS of $0.50.

Intel's revenue was $12.9 billion, which was flat compared to the $12.85 billion revenue of a year ago. Revenue for the PC client group, which sells PC, tablet and smartphone microprocessors, fell to $8.45 billion from $8.62 billion. Revenue for the Data Center Group, which sells server equipment, was $2.45 billion, flat compared to the $2.46 billion a year ago.

The software revenue, however, grew to $571 million, compared to $240 million a year ago.

The first quarter of 2012 was a thirteen-week quarter, while the first quarter of 2011 was a 14-week quarter, an Intel spokesman noted.

The first quarter was a "solid start" to what will be a growth year for Intel, said CEO Paul Otellini in a statement. The first Intel Inside smartphones will ship later this quarter, which should trigger the first volume shipments of Atom chips for smartphones. Atom has been a weak spot for Intel ever since the netbook market declined with the emergence of tablets. Intel has virtually no presence in the tablet market, which is dominated by ARM.