Intel profit climbs; sales miss target
By Matt Andrejczak, MarketWatch
Last Update: 4:56 PM ET Jan. 17, 2006
SAN FRANCISCO (MarketWatch) -- Intel Corp. reported Tuesday its fourth-quarter profit rose 16% but its sales fell short of its own target, clipped by weaker prices and lower-than-expected shipments of chips for desktop computers.
Intel also issued a first-quarter sales forecast that lagged most estimates, and shares of the world's largest supplier of computer lost ground in after-hours trading.
In after-hours trading, shares of Intel fell 6.3% to $23.92. In regular hours trading, the stock closed at $25.52, down 27 cents.
The results cap a year in which Intel faced more pressure from smaller rival Advanced Micro Devices Inc., which is scheduled to issue its quarterly report on Wednesday.
But Intel did rack up its third straight year of double-digit earnings and revenue growth.
Earnings for the quarter totaled $2.5 billion, or 40 cents a share, compared with $2.1 billion, or 33 cents a share, in the same period last year.
Sales rose 6% to $10.2 billion but missed the expectations of analysts surveyed by Thomson First Call who expected $10.56 billion.
In its Dec. 8 midquarter forecast, Intel had said it expected sales in the range of $10.4 billion to $10.6 billion. Intel added it will no longer issue midquarter financial updates to the public.
Analysts estimated Intel would earn 43 cents a share, excluding stock option costs. In a press release, the company didn't say how much option costs impacted results.
Looking ahead to results for the quarter now in progress, Intel said sales will be between $9.1 billion to $9.7 billion. Analysts are forecasting $10 billion.
Intel has begun making some of its chips using new manufacturing technology that enables the firm to cram more chips on a single wafer, boosting profit margins.
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Intel CFO says lost share to AMD
Tue Jan 17, 2006 04:45 PM ET
SAN FRANCISCO, Jan 17 (Reuters) - Intel Corp. (INTC.O: Quote, Profile, Research) may have lost a point of market share to rival Advanced Micro Devices Inc. (AMD.N: Quote, Profile, Research) , Chief Financial Officer Andy Bryant said on Tuesday.
"AMD may have taken a point of share from us," Bryant told Reuters in an interview.
Asked if AMD had gained ground in the desktop market where Intel saw unexpectedly weak sales in its fourth quarter, Bryant said the market share loss was "overall, but desktop was where it would have been".
Bryant also said that a chipset shortage that acted as a bottleneck on sales for much of 2005 was nearly resolved.
"We believe that he have enough now to meet everybody's needs in the first quarter," Bryant said, adding "We still believe it will take a while to get all the supply lines working."
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