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Intel warns of revenue dip

Intel warns of revenue dip

The belts are likely to be tightened at Intel following news that it's experiencing a massive 23 drop in revenue.

Intel's showing at CES was overshadowed this week with the news that the chip giant was predicting a massive 23 percent drop in revenue.

CNet reports that Intel's fourth quarter earnings report contains an $8.2 billion revenue expectation, which is a massive 23 percent down on year-earlier figures, and 20 percent lower than third quarter revenue.

With industry analysts claiming a 26 percent decline on consumer electronics sales year-on-year, it's not hard to see why Intel is feeling the pinch. The current depressed economic climate worldwide is slowing spending, which is in turn decreasing demand – leading the channel to be filled with excess inventory that has to be discounted ever steeper. The excess inventory leads to fewer orders from the chip makers themselves, and it's this slowdown in purchasing that is causing Intel some significant heartache this quarter.

The company is far from on the blocks, of course – although the revenue prediction is pretty dire, it's still a good-sized turnover. Increased interest in the netbook market and the success therein of Intel's low-power Atom range will be helping the company, but reduced spending on high-end products such as systems based around its new i7 processor will be taking such gains away again. It's clear that while Intel isn't going to be closing its doors any time soon, there's definitely going to be some belt tightening if things don't improve in the next few financial quarters.

Do you believe that Intel is well positioned to build its revenue back up, or is it missing something critical from its chip line-up? Share your thoughts over in the forums.

8 Comments

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B1GBUD 8th January 2009, 11:56 Quote
Oh no, a profit of only 8.2 BILLION!! I can't quite see any bungee-less jumpers from the boardroom just yet.
p3n 8th January 2009, 11:56 Quote
I have faith in chipzilla - they haven't been selling SSDs long have they? Surely that will replace some lost PU sales!
Gareth Halfacree 8th January 2009, 12:21 Quote
Quote:
Originally Posted by B1GBUD
Oh no, a profit of only 8.2 BILLION!! I can't quite see any bungee-less jumpers from the boardroom just yet.
Revenue, not profit. Revenue is the money that comes in before you take anything off. Profit is revenue minus costs.
B1GBUD 8th January 2009, 13:28 Quote
Quote:
Originally Posted by Gareth Halfacree
Quote:
Originally Posted by B1GBUD
Oh no, a profit of only 8.2 BILLION!! I can't quite see any bungee-less jumpers from the boardroom just yet.
Revenue, not profit. Revenue is the money that comes in before you take anything off. Profit is revenue minus costs.

My bad... still I bet they're in the black
Bauul 8th January 2009, 14:33 Quote
Quote:
Originally Posted by B1GBUD
Quote:
Originally Posted by Gareth Halfacree
Quote:
Originally Posted by B1GBUD
Oh no, a profit of only 8.2 BILLION!! I can't quite see any bungee-less jumpers from the boardroom just yet.
Revenue, not profit. Revenue is the money that comes in before you take anything off. Profit is revenue minus costs.

My bad... still I bet they're in the black


Yes, but only just apparently. Still, I bet they have plenty of cash to see them through.
Petor 8th January 2009, 15:40 Quote
I'm more worried about AMD :S
n3mo 8th January 2009, 17:37 Quote
The less Intel earns, the bigger my smile is. Serves them right for expecting that people will pay such ridiculous money for i7.
BFT-001 10th January 2009, 07:25 Quote
Quote:
Originally Posted by Petor
I'm more worried about AMD :S

So am I, though I may lean towards Intel a whole lot more, the idea of Intel monopolizing the industry is truly scary.
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