Intel Slashes Fourth-Quarter Earnings Expectations

January 8th, 2009

In what could be the first of some bad reports from technology giants, Intel on Wednesday announced preliminary fourth-quarter financial data . Revenue was about $8.2 billion, down 20 percent sequentially and 23 percent year over year. That’s even lower than Intel predicted on Nov. 12.Intel blamed weak demand and inventory reductions in the global PC supply chain. Intel’s preliminary estimate of gross margin for the fourth quarter is at the bottom of the previous expectation of 55 percent, plus or minus a couple of points.

It could be that as Intel goes, so goes the PC market, according to Charles King, principal analyst at Pund-IT Research. King confirmed that Intel’s announcement could be a sign of more bad news to come.

“It looks to me like the demand for its PC chip in particular has really fallen off the cliff, which is not really surprising,” King said. “The market in general for PCs over the last quarter has looked grim leading up into the holiday season, and electronics retailers’ revenue numbers were pretty awful as well.”

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