Intel Corporation last night said quarterly profit rose 15 per cent, helped by record sales in Asia and stronger demand for notebook and server computer chips, and gave an outlook that reassured jittery investors that it could grow despite tough market conditions.
Shares of the world's largest chip maker rose more than 3 per cent in after-hours trading. The stock had fallen in recent days on fears the company would report disappointing results even after cutting its revenue forecast last month.
Earnings in the third quarter ended September 25 were $1.91 billion, or 30 cents a share, compared with a year-earlier profit of $1.66 billion, or 25 cents a share. Revenue rose to $8.47 billion from $7.83 billion last year, helped by record sales to Taiwan and South Asia, including India.
Inventory levels, which swelled in the second quarter to a record high, fell about 1 per cent to $3.18 billion in the period. High inventories of unsold and unfinished products were among the first signs of trouble before the technology bubble burst in 2000.
"Because they've guided analysts carefully, it does get the third-quarter earnings season off on a good note but not a great one," said Mr Hugh Johnson, chief investment officer at First Albany Corp.
Intel, a bellwether for the technology sector, has conceded it overproduced in the first half of the year, and had to ratchet back production even as it pours billions of dollars into upgrading factories. Intel's much smaller rival, Advanced Micro Devices Inc., has also renewed efforts to outflank Intel with the successful launch of a server chip.
The third-quarter profit included a tax benefit of 3.6 cents per share, including a 0.6-cent gain the company had previously discussed. Intel said it underestimated the amount of federal deductions it could take last year for overseas sales.