For all you Intel Polyannahs, consider this simple logic based on the
brilliant projection of the company shill at Merrill.
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Intel said its net income was $1.7 billion, or 51 cents per share, compared with First Call Corp.'s estimate for 53 cents per share. In the year-ago period the chip giant earned $1.2 billion, or 33 cents per share and in the first quarter Intel earned 57 cents per share. Revenue for the period was $6.7 billion, vs. $5.9 billion in the year-ago second quarter.
Merrill Lynch analyst Joe Osha had projected Intel's revenue at about $7.2 billion. Revenue for the first quarter was $7.1 billion, and at that time the company predicted sales for the second quarter would be "flat to slightly down" from the first quarter. Osha also expected Intel's net profit to be $1.9 billion, or 55 cents a share.
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Osha expected income of 55c/share on revenue of $7.1b.
However revenue was $6.7b, a 500 MILLION DOLLAR SHORTFALL
from the nominal projection. Per se I wouldn't be worried about that because, well, you can't force people to buy more when they don't need more, can you. So given fixed costs, etc. figure with a 55% gross margin that this shortfall would translate, in Osha's model, to an income "loss" of $275 million. 8c/share short of his .55, or .47c.
However they reported 51 cents. So by hook or by crook they were able to manufacture 4 cents more in "income" just so you won't feel so bad.
Greg
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