Intel warns slowing economy will dent next quarter income
- 17 July 2012
- From the section Business
The world's largest maker of computer chips, Intel, says the weak economy will mean its next profits will miss forecasts.
The company's second-quarter net income was $2.83bn (£1.8bn, 2.3bn euros), 4.3% below that made in the second quarter of last year.
Operating expenses rose faster than its revenue, which rose 3.6% to $13.5bn.
Intel has also been buying back shares, an activity that helped keep earnings per share flat.
The company said it expects to make revenue of $13.8-$14.8bn in the third quarter with a mid-point of $14.3bn, below current analyst forecasts of $14.6bn.
Intel cut its revenue growth forecast for the whole of this year to between 3-5%, down from a previous forecast of "high single-digit growth".
The company makes chips for 80% of the world's personal computers (PCs) but has a far smaller presence in tablet computers like Apple's iPad, or in the fast-growing smartphone sector.
Tablet computer sales are rising far more quickly than those of PCs.
Intel's chief executive, Paul Otellini said in a statement: "As we enter the third quarter, our growth will be slower than we anticipated due to a more challenging macroeconomic environment."