Intel Corp., the world's largest chipmaker, is scheduled to release Q12010 earnings after the closing bell on Tuesday, April 13, 2010. Analysts, on average, are looking for earnings of $0.37 per share in the first quarter with estimates ranging between $0.35 to $0.41 per share. Revenues for the quarter are estimated to be $9.8 billion. In the Q12009, Intel reported earnings of $0.11 per share on revenue of $7.15 billion.Intel Corporation designs, manufactures, and sells integrated circuits for computing and communications industries worldwide. It offers microprocessor products used in desktops, nettops, workstations, servers, embedded products, communications products, notebooks, netbooks, mobile Internet devices, and consumer electronics, as well as in embedded designs, such as industrial equipment, point-of-sale systems, panel PCs, automotive information/entertainment systems, and medical equipment. In the third quarter of 2009, Intel accounted for 80.6 percent of overall global microprocessor revenue, according to market research firm iSuppli.
In the preceding Q42009, the Santa Clara, California-based company reported that its fourth quarter profit jumped 875% $2.28 billion or $0.40 per share, compared to $234 million or $0.04 per share for the year-ago quarter. Excluding items, net income for the fourth quarter was $3.09 billion or $0.55 per share, compared to $844 million or $0.15 per share in the prior year quarter. Revenue rose 28% to $10.57 billion from $8.23 billion in the same quarter last year. Analysts, on average, expected the company to earn $0.30 per share on revenue of $10.17 billion. Gross margin for the fourth quarter increased to 64.7% from 53.1% a year ago.
For the first quarter, the company expects revenue of $9.7 billion, plus or minus $400 million, and gross margin of 61%, plus or minus 2 percentage points. For the full year 2010, the company targets gross margin of 61%, plus or minus 3 percentage points, and capital spending of $4.8 billion, plus or minus $100 million.
The chipmaker has benefited immensely due to a strong rebound in worldwide PC shipments, signaling an economic recovery. With the economic recovery picking up, PC shipments this year will grow by 12.6% year-over-year to 333.2 million units, according to IDC's forecast. The Semiconductor Industry Association predicts that worldwide industry sales will grow 10% in 2010, to $242 billion, and another 8% in 2011, to around $262 billion.
Industry believe that the company got a boost from Chinese New Year in February - a season of high spending in China - as a reason for robust sales, especially in computers, in the world's No.3 economy. About 57% of Intels' revenue in the fourth quarter came from the Asia-Pacific region
Last month, Intel Corp. rolled out the latest version of its Xeon processor, billed as being more secure and energy-efficient. The company introduced new chips at a time when there are expectations of strong refresh cycle in corporate PCs later this year. "Eighty percent of the (server) installed base is up for a refresh. And the installed base is a lot of old, inefficient, single-core servers," said Davis. Last year, many businesses postponed purchases of hardware as technology spending declined amid economic slump. Both Intel and AMD are trying to woo companies that are gearing up to make purchases. The demand for new processors may also get a boost from escalating trend towards cloud computing and virtualization.
Meanwhile, according to media reports, Intel has teamed up with Google Inc., Sony Corp. to marry Internet content with conventional TV, extending technology into the living rooms. The companies are reportedly working on developing a set-top box running Google's Android operating system for the new platform called Google TV. The box will allow users to access Internet content alongside traditional television programming through the Google Chrome browser, with a user interface designed by Google.
In terms of stock performance, Intel shares have gained nearly 10 percent since the beginning of the year.
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