Intel beats Wall Street expectations, but experienced a decline in profit
Santa Clara, CA, United States (4E) – Chipmaker Intel exceeded Wall Street’s lowered expectations in its 3rd quarter earnings report, but its profit declined by 14 percent year-over-year. This is due to falling PC sales and rising operating expenses. Intel provides chips for personal computers and business servers.
Intel had revenue of $13.5 billion in the third quarter barely beating the $13.2 billion expectations set by Wall Street analysts. Its profit is down by 5% compared to last year’s third quarter earnings report. The Santa Clara-based company also showed it earned 60 cents per share, also surpassing the 49 cents per share estimation of analysts.
“Our third-quarter results reflected a continuing tough economic environment. The world of computing is in the midst of a period of breakthrough innovation and creativity,” Intel chief operating officer Paul Otellini said in a statement.
Intel was able to beat expectations despite lower PC sales because its business unit performed reasonably well and tax rates helped lighten the company’s slumping PC sales.
According to research firms Gartner and IDC, PC shipment has dropped by 8 percent in the third quarter. Intel still managed to perform better than its main competitor AMD. AMD’s share price has fallen by an estimated 50 percent in 2012.
Intel is expecting to perform better in the fourth quarter.
“As we look to the fourth quarter, we’re pleased with the continued progress in Ultrabooks and phones and excited about the range of Intel-based tablets coming to market,” Otellini added.