Intel Corp's third-quarter profits more than doubled Tuesday as the world's largest semiconductor company benefited from the strongest demand for personal computers since the high-tech boom of the late 1990s.
For the first time in the economic recovery, Intel executives said the company's growth was outpacing normal seasonal patterns.
"Third-quarter revenue grew 15 percent over the second quarter. That's the highest third-quarter growth rate we've seen in over 25 years," said Andy Bryant, Intel's chief financial officer. "It's well above normal seasonal ranges."
PHOTO: REUTERS
For the three months ended Sept. 30, Intel earned US$1.7 billion, or US$0.25 per share, compared with profits of US$686 million, or US$0.10 per share, in the same period last year. Sales rose 20 percent to US$7.8 billion, from US$6.5 billion last year.
At the end of the second quarter, Intel initially predicted sales of US$6.9 billion to US$7.5 billion. A few weeks later, it upped the estimate to between US$7.3 billion and US$7.8 billion. Last month, it narrowed the range to between US$7.6 billion and US$7.8 billion.
"Our resolve to invest aggressively during the downturn is paying off with double-digit revenue growth and a doubling of profit compared to a year ago," said Craig Barrett, Intel's chief executive.
The profits were driven by Intel's microprocessor group, which supplies the electronic brains of more than 80 percent of the world's personal computers. The company reported record shipments of processors, chipsets and motherboards.
But much of the demand is from developing countries such as Russia, India and China, Bryant said.
"We've always said [information technology] spending in mature geographies would lag a recovery," he said. "We're seeing the effect of the strong economies and the quicker return to purchases. In the mature economies, it's a little bit slower."
The company estimated fourth-quarter revenues of between US$8.1 and US$8.7 billion. By comparison, the consensus analyst estimate was $8.32 billion.
Intel's results also have benefited from the stability of microprocessor prices and relative weakness among competitive offerings. Analysts say Intel has been growing its market share in the absence of strong offerings elsewhere.
The company also continues to strongly push its Centrino mobile technology for laptops and other mobile computers. It has invested US$300 million to market the brand.
"Centrino is doing wonder-fully," Bryant said. "We did set records for mobile unit shipments in the third quarter, primarily on the basis of Centrino and the Pentium M program."
But there are signs that the competitive landscape is changing. Last month, Advanced Micro Devices launched its Athlon 64 chip line. On Tuesday, Transmeta Corp unveiled a new power-efficient processor called Efficeon that will compete with Intel's Centrino part Pentium M.
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