Intel, the world's largest chip maker, today reported a 25 per cent rise in quarterly profit on strong demand for its Centrino notebook computer chips, sending shares up 3 per cent and allaying fears of an industry slowdown.
The results, which sent a wave of relief through Wall Street after last week's bombshell earnings shortfall from International Business Machines, came in at the top end of Intel's forecast and above the average analyst estimates.
"We still see pretty solid demand around the world," Intel Chief Financial Officer Andy Bryant said in an interview.
"I can't yet say that I see the signs of weakness that IBM saw." Intel also raised its forecast for annual gross profit margins and boosted its yearly budget for spending on chip factories by $500 million, lifting shares of suppliers of semiconductor manufacturing equipment.
"Intel beat across the board," said Steve Neimeth, portfolio manager at AIG SunAmerica Mutual Funds, who oversees funds owning about 200,000 Intel shares.
Net income in the first quarter ended April 2nd rose to $2.15 billion, or 34 cents a share, compared with a year-earlier profit of $1.73 billion, or 26 cents a share.
Sales rose to $9.43 billion from $8.09 billion, slightly below the all-time company record of $9.6 billion set in the fourth quarter of 2004.
The results from the Santa Clara, California-based company topped the average Wall Street expectation of a profit of 31 cents a share on sales of $9.31 billion, according to a poll of analysts by Reuters Estimates.
Intel shares rose as much as 3.6 per cent to $23.45 in after-hours action following the news, which came after the close of regular session trading yesterday.