A strong Q2 out for Intel

The subprime mortage crisis is going from bad to worse. Oil is hovering near all-time highs. Global financial markets seem on the verge of melting down.

Intel CEO Paul Otellni

(Credit: Dan Farber/CNET News)

And yet Intel just had itself one hell of a second quarter.

The company's second quarter earnings per share soared to 28 cents from 22 cents during the same period a year earlier. Intel posted $9.47 billion in revenue, up from $8.68 billion. In after hours, Intel shares were jumping on the strength of the forecast of between $10 billion to $10.6 billion in sales. The company also foresees gross margins at around 58 percent, plus or minus a couple of points.

In the current quarter, however, gross profit margins came in at 55.4 percent. Although that was up from 53.8 percent in the preceding quarter, it still remained just shy of the midpoint of earlier expectations. Not a huge surprise considering what's happening in the market--in particular the competition with Advanced Micro Devices for a bigger share of the lower-priced notebook PC business.

Still, the company can't complain. Intel received a big lift from the ongoing shift from desktop to notebook computers. In its release, the company noted that mobile microprocessor and chipset units both set records.

The company's conference call doesn't start until later this afternoon, but here's the canned quote which came along with the release.

"Intel had another strong quarter with revenue at the high end of expectations and earnings up substantially year over year," said Paul Otellini, Intel president and CEO. "As we enter the second half, demand remains strong for our microprocessor and chipset products in all segments and all parts of the globe."

[Kwasiowusu]

With results like that from Intel, its no surprise Microsoft was up strongly today. Expect Microsoft to report equally strong results on Thursday, gievn that by far most Intel procesors are sold with Windows computers worldwide, and in addition, Microsoft makes a fortune from MS Office, which has been growing strongly in sales as well.

[Penguinisto]

Dunno... Apple has been growing far faster, and a very large percentage of CPU sales go to enterprises who receive them with no OS on the disks or COA stickers on the case.

[sevort]

It's actually Mac OS that helped Intel, not Windows, since Apple uses more expensive (and more profitable for Intel) processors and sells a lot of them.

[YankeePoodle]

I think the high gas prices are making people use the net more than they usually do. I bet this recession is one in which Tech sector remains strong or untouched.

[Penguinisto]

I agree... telecommuting is on the rise, which means that the tech industry stands to hold steady and/or gain in areas which concern network and telecommuting.

[Imalittleteapot]

Makes perfect sense to me too. More people probably buying computers just for fun too so they don't have to leave the house as much.

[Commander_Spock]

Re: "Makes perfect sense to me too. More people probably buying computers just for fun too so they don't have to leave the house as much". It gets even better when people begin to see the value of purchasing the computers and moving the business place closer to the bedrooms or "walking" distance from the homes (they get to save on gas plus they get to exercise a bit too).

[Commander_Spock]

Re: "The subprime mortage crisis is going from bad to worse. Oil is hovering near all-time highs. Global financial markets seem on the verge of melting down. And yet Intel just had itself one hell of a second quarter. The company's second quarter earnings per share soared to 28 cents from 22 cents during the same period a year earlier. Intel posted $9.47 billion in revenue, up from $8.68 billion. In after hours, Intel shares were jumping on the strength of the forecast of between $10 billion to $10.6 billion in sales. The company also foresees gross margins at around 58 percent, plus or minus a couple of points..." There are very simple reasons for all of these - TECHNOLOGY RULES THE WORLD; AND, IT IS AS QUITE SIMPLE AS THAT! Also, it is called - PROJECT)S) RANKING!

[Commander_Spock]

Re: "Global financial markets seem on the verge of melting down"!!! Miss Money Penny to MI6 - The US Economy (like Commander Bond) Is Well On Its (His) Way To Economic Recovery) particularly as INTEL gives support for "64-Bit features" in the OS/2 Operating System - this according to Commander "DATA"

Follow the attached links and read why "64-Bit Applications for OS/2" (with INTEL's support) may hold the key to the world's "Finance and Economic Recovery"!

Substituting "The Explosion of the Ariane 5" for the "Global financial markets seem on the verge of melting down" ;-)

http://www.ima.umn.edu/~arnold/disasters/ariane.html