Intel takes a beating in Q4

Chip giant Intel suffered a revenue drop of five per cent down to $9.7 billion and a drop in net income of 39 per cent down to $1.5 billion in Q4. Although the figures did beat analyst’s modest predictions of $9.45 billion in sales, investors sent Intel shares down close to four per cent. The results reflect a difficult period for the firm following the strengthening of its arch-rival AMD through the purchase of graphics specialist ATI.

In a year that saw Intel overhaul its mainstream processor range and lay off more than 10,000 workers in an attempt to maintain a performance lead over AMD and reduce costs, its revenue for the year dropped by almost ten per cent down to $35.4 billion, while its net income dropped 42 per cent down to $5 billion.

Despite the figures, Intel remained publicly buoyant – citing record server, mobile and flash memory product sales as a success. It also championed the arrival of samples of its 45nm Penryn chips, which are due to be launched in the second half of next year. Intel claims the chips have already powered up four operating systems – Windows Vista, Windows XP, Linux and Mac OS X. “Q4 was a strong ending to a difficult year,” claimed Intel’s CFO Andy Bryant.

Meanwhile, the firm is optimistic about the year ahead, pointing to its new product line up and its manufacturing process lead over rival AMD – and is expecting revenue in Q1 of 2007 to land in between $8.7 billion and $9.3 billion.