Intel yesterday forecast slowing growth for the personal computer industry this year and reported that several million of its microprocessors had piled up at its customers over the past two quarters.

In an admission that Intel's execution was as much a problem as industry conditions, Paul Otellini, chief executive, Intel told an analysts' meeting in New York that work was under way to "restructure, repurpose and resize" the company to set its course for the next few years.

Mr Otellini had announced a "wholesale look" at the world's biggest chipmaker at its quarterly results presentation last week, when Intel announced profits had fallen by one third. He gave analysts more detail yesterday, saying "no stone will be left unturned . . . we will see a leaner, more agile and more efficient Intel Corporation after the end of this project".

Mr Otellini said it would be too simplistic to cut its 100,000-strong global workforce. Intel's analysis would tackle non-performing businesses, market conditions and employee productivity. Intel employs around 5,000 people at its production facility in Leixlip, Co Kildare.

The review will be the biggest since the company was transformed in the mid-1980s from a memory chip company to one focused on microprocessors.

Intel is promising a $1 billion (€798 million) reduction in costs this year and a $300 million cut in capital spending. Intel expects sales to fall 3 per cent in 2006 after three years of double-digit growth and at a time when the rest of the industry is performing strongly. The company holds more than 80 per cent of the market for the dominant "x86" PC microprocessors.

Its stock has fallen more than 20 per cent this year to become the worst performer in the Dow Jones Industrial Average. Intel shares were up 3.28 per cent to $20.13 in New York following Mr Otellini's comments.