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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Fred Fahmy who wrote (79756)	4/23/1999 8:38:00 AM
From: Glenn D. Rudolph	Respond to of 186894

Intel sees virtual close-out of older Pentium IIs NEW YORK, April 22 (Reuters) - Intel Corp. <INTC.O> executives on Thursday confirmed its schedule for the rapid transition of its core microprocessor line almost entirely to Pentium III chips by year-end. Speaking to financial analysts in New York, Paul Otellini, executive vice president of the Intel Architecture Business Group, said the company planned to rapidly phase out its older Pentium II technology over the course of this year. "It is about to hit 50 percent sometime in the third quarter and about 90 percent converted as we exit 1999," Otellini said, referring to the transition to Pentium III chips and the rapid reduction of the Pentium II category. Intel is seeking to segment its core business into a range of high-end Pentium III products designed for use in demanding desktop PC computers, in mobile notebooks and in powerful machines known as servers that manage networks of other PCs. Meanwhile the low-end of Intel's microprocessor product line will be filled by its Celeron line, which is designed for low-cost PCs sold both to businesses and consumers. The newer Pentium III design first became available commercially in personal computers in late February. In addition, Otellini said Intel was now shipping its newest and fastest Celeron chip, a 466 megahertz version, that will be officially announced Monday, when it becomes available for sale to customers; 433 megahertz was previously fastest. Looking ahead, Otellini updated the company's roadmap for future developments of its various microprocessor lines. Craig Barrett, Intel's president and chief executive, said that the next generation of its microprocessor line beyond Pentium -- codenamed Merced -- is in its final design stages and that sample volumes will ship to PC makers later in 1999. He predicted mass shipments of Merced by mid-year 2000. McKinley, the subsequent generation after Merced, which has improved Internet bandwidth characteristics, will have samples available to computer makers by late in 2000, with mass market production "a year after that," Barrett said. More immediately, Otellini said Intel would push the performance of Pentium III chips by the second half of 1999 to the same 600 megahertz speeds available in the fastest desktop PCs at that time. By contrast, the fastest desktop processor Intel expects to ship in the first half of 1999 will run at 550 megahertz. The fastest notebook chip will run at only 366 million cycles. The fastest mobile processor will run above 600 megahertz in the second half of 1999 and 700 megahertz or greater by the first half of 2000 -- speeds parallel to what simultaneously will ship in mainstream Pentium III desktop PCs. "We essentially hit desktop equivalencies in the second half of this year," Otellini said. The company has been attempting to segment its market into different customer categories since it ended its one-size fits all policy of providing a single category of chips to serve all types of customers in 1997. Sean Maloney, Intel's sales and marketing chief, said the company is generating about $1 billion in revenue per month from customers buying its products over the Internet. To compare, Intel's revenues totaled about $26 billion last year. About 200 customers -- makers of PCs and related products -- now buy from Intel via the Web, he said. "There is no reason why in the next two to three years 90 percent or more of our revenue won't come to us from the Internet," he said. In heavy volume, Intel stock had added $2.56 to trade at $61 on the Nasdaq stock market, where it was the second most active stock after Dell Computer Corp. <DELL.O>, a big buyer of its products.