Intel Says Asia Ex-Japan Sales in ? Near Pre-Crisis $7.4 Bln
11/28/99 8:52:00 PM
Source: Bloomberg News
Singapore, Nov. 29 (Bloomberg) -- Intel Corp., the world's biggest chipmaker, said its sales from
Asia, not including Japan, this year will be near the $7.4 billion level they were at in 1997, when the
region slid into its worst recession in decades.
''Asia is going through a much better year than 1998 -- it's on its way back towards recovery and unit
wise, it looks as if Asia's going back to the same growth rates as 1997,'' Sean Maloney, Intel's senior
vice president, said in an interview.
Intel's sales from Asia outside of Japan fell 28 percent to $5.3 billion
last year. In contrast, sales from the region rose 27 percent in 1997.
Purchases by homes and companies in countries from Singapore to
South Korea of personal computers and other related software is set to
put the company back on the road to sustained revenue growth. The
region makes up a fifth of Intel's total revenue.
Intel joins other computer and software companies that have seen a
strong rebound in Asian sales. Last week, Hewlett-Packard Co., the
world's No. 2 computer maker, said its Asian sales in the year ending
October will cross the $7 billion level they were at just before the
region's financial turmoil in 1997.
Intel may also beef up production at its Asian manufacturing sites in the Philippines, Malaysia and
China, raising exports for these countries. Maloney, however, said there are no immediate plans to
boost production at the plants.
Internet
Instead, Intel plans to increase its investments in Asian Internet-related companies from the 23
start-ups and ventures it invested in this year, as the region plays a bigger role in the company's
e-commerce plans.
Worldwide, Intel has invested $4.8 billion in Internet companies, mainly in the past year. Intel's
Internet investments are expected to help stimulate sales of personal computers and other equipment
which use its semiconductor chips, boosting its sales.
''The Internet is really the demand generator,'' Maloney said, ''and the driving factor in Asia is
definitely the Internet.''
While the Internet is still in its infancy in some Asian countries, Intel now conducts all its business in
Taiwan on the Internet, a global first for the company. Japan is set to follow by the end of the year.
Its Internet investments in the region include a $50 million joint venture with Pacific Century
CyberWorks Ltd. in Hong Kong, the biggest Internet company in Asia excluding Japan, and
HelloAsia.com, an online retail rewards service, whose biggest office is in Singapore.
''There's some very innovative work going on here in Asia,'' Maloney said. ''In the next five years,
Asian economies and Asian consumers will play a very important role on the Internet.''
Separately, Maloney said the impact on the supply of chips of the Taiwan earthquake is wearing off.
''All the products at the moment are tight, but we expect to meet overall unit demand for the quarter,''
he said. ''The earthquake had an impact, but not enough to materially affect the quarter'' as the chip
contract manufacturers are back in production.
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