Chipmaker Intel lifted its second-quarter financial targets last night due to strong demand for its chips used in laptop computers.
In its midquarter update, Intel said sales would be between $9.1 billion and $9.3 billion, compared with its prior forecast of $8.6 billion to $9.2 billion.
The California-based chipmaker said its gross margin, an important measure of profitability for chip firms, would be 57 per cent of sales, higher than the 56 per cent it had previously estimated.
The company said its tax rate would be 26 per cent, lower than the 31 per cent it had originally forecast due to increased research and development tax credits. In addition, it said equity investment gains would be $100 million, more than the $70 million it had expected.
Leading up to the announcement, some financial analysts had boosted their second-quarter estimates on Intel, citing continued demand for its wireless Centrino laptop chip and better-than-anticipated shipments of microprocessors for desktop PCs.
Brisk laptop sales bode well for Intel, which has kept inventories for its mobile chips lean to better gauge demand.Profit margins for laptop chips are higher than sales of desktop processors.