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Intel Expected to Report First Sales Gain in Six Quarters

post #1 of 10
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July 17 (Bloomberg) -- Intel Corp., the world's largest computer-chip maker, may report its first sales gain in six quarters today, helped by rising demand for laptops.
Revenue may have increased 7 percent to $8.54 billion in the second quarter, according to the average of 24 estimates in a Bloomberg survey of analysts. Net income probably advanced 26 percent to $1.12 billion, or 20 cents a share, from $885 million, or 15 cents, a year earlier, the survey showed.
Intel shares surged 24 percent in the quarter after Chief Executive Officer Paul Otellini won back market share lost last year to Advanced Micro Devices Inc. Intel didn't have to cut prices as much as in previous quarters, allowing the Santa Clara, California-based company to wring more profit from its chips as consumers snapped up notebook personal computers.
``Clearly business has bottomed for Intel,'' said Christopher Danely, an analyst at JPMorgan Chase & Co. in San Francisco. He rates the stock ``overweight'' and said he doesn't own it. ``The PC space is better than expected.''
Danely, UBS AG analyst Uche Orji and Bear Stearns Cos.' Gurinder Kalra said the chipmaker probably beat the average sales estimate. Intel reports results after the close of regular Nasdaq Stock Market trading today. Spokesman Tom Beermann said the company wouldn't comment for this story.
Shares of Intel rose 21 cents to $26.16 at 10:19 a.m. New York time in Nasdaq trading. Before today, the stock was the fourth-best performer on the Dow Jones Industrial Average this year, gaining 28 percent, after being the worst stock in the index in 2006, when earnings fell 42 percent.
Twenty-five analysts tracked by Bloomberg recommend buying Intel's stock, up from 19 with ``buy'' ratings three months ago.
Otellini's Turnaround
Otellini, 56, revived the company's market share from an 11- year low at the end of the fourth quarter. He replaced the 6- year-old Pentium 4 design with a new chip that is faster and uses less power.
PC demand is climbing, helped by demand in countries such as China. Worldwide PC shipments may rise 11 percent to 257.1 million this year from a year ago, researcher Gartner Inc. in Stamford, Connecticut, reported last month.
To keep the shares rising, Orji said, Intel needs to improve profitability. In April, the company said gross margin, or the percentage of sales remaining after production costs, would be about 48 percent in the second quarter. Intel's gross margin has averaged 55 percent since 2002.
`Next Catalyst'
``We need to see Intel indicate that gross margins are expanding aggressively,'' said Orji, based in New York. He predicts the stock will rise to $30 in 12 months. ``That is what will be the next catalyst.''
In May, Otellini told investors in New York that Intel is on course to meet its target of annual cost savings of $3 billion in 2008. The company has cut more than 10,000 jobs, or 9.8 percent of its workforce, since September, reduced spending on new plants, and sold unprofitable businesses.
Advanced Micro's stumbles contributed to Intel's rebound in the $33 billion microprocessor market. Sunnyvale, California- based Advanced Micro was late introducing Barcelona, its latest server chip, and the processor is slower than expected, Danely said.
The company ``plans to steadily increase the performance of these next-generation processors,'' Advanced Micro spokesman John Taylor said in an e-mail today. ``We stand by our performance projections.''
Intel's Dominance
Measured by shipments, Intel had 81 percent of the PC processor market at the end of the first quarter, a gain from 74 percent at the end of last year, Cave Creek, Arizona-based Mercury Research said. Advanced Micro slumped to 19 percent, its first time at less than 20 percent since 2005.
Advanced Micro had a loss of $611 million the first quarter and analysts predict the company won't be profitable this year or next. That means the chipmaker may not be able to continue the price cuts that helped the company win sales last year and trimmed Intel's margins, analysts said.
Average selling prices for microprocessors dropped to $117 in the first quarter from more than $130 in 2005, according to Mercury Research.
``Prices have become more stable,'' said Orji, who doesn't own Intel shares. ``The price war has been sucking the energy from the sector.''
Shares of Advanced Micro, which reports results July 19, fell 9 cents to $15.63 in New York Stock Exchange composite trading, and had declined 23 percent this year before today.


http://www.bloomberg.com/apps/news?p...f9w&refer=home



I bought a bucket-full of Intel stock in 2006
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post #2 of 10
Good find man. It truly is sad that how AMD can't get back on it's feet. If Barcelona is a hyped as it performs it will be great at least for AMD's quad core market and if the prices are really low but things look bad really bad for them.

It isn't the same as the intel Pentium 4 days at all because even if intel was loosing money for such time they where the major chip manufacterer for consumer rigs not necessarily enthusiast stuff for us and and there are more noobs than enthusiests so there for they where not doing half bad.

On the other hand AMD doens't have the disposable income. They don't even have anything in the laptop market. I've always seen people on the street with P4 or Celeron M chips stickers on there notebook but never an AMD sticker.
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post #3 of 10
AMD is screwed unless Barcelona is incredible which I severely doubt. AMD really do need to bring out some new, amazing and well priced Dual and Quad core CPU's.
    
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post #4 of 10
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Originally Posted by Metalica732 View Post
Good find man. It truly is sad that how AMD can't get back on it's feet. If Barcelona is a hyped as it performs it will be great at least for AMD's quad core market and if the prices are really low but things look bad really bad for them.

It isn't the same as the intel Pentium 4 days at all because even if intel was loosing money for such time they where the major chip manufacterer for consumer rigs not necessarily enthusiast stuff for us and and there are more noobs than enthusiests so there for they where not doing half bad.

On the other hand AMD doens't have the disposable income. They don't even have anything in the laptop market. I've always seen people on the street with P4 or Celeron M chips stickers on there notebook but never an AMD sticker.
I have a feeling that Intel completely dominates the notebook market. What is sad (for us) is that desktop products are going to receive a smaller and smaller amount of R&D. The money just isn't there... it is in the mobile sector.

It likely will not be long before the only thing offered is a mobile processor...
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post #5 of 10
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Originally Posted by pauldovi View Post
I have a feeling that Intel completely dominates the notebook market. What is sad (for us) is that desktop products are going to receive a smaller and smaller amount of R&D. The money just isn't there... it is in the mobile sector.

It likely will not be long before the only thing offered is a mobile processor...
Seriously there are so many people out there with Laptops it is unbelievable. I read somewhere more people now own laptops than PC's and the thing is Laptops are terrible! Cost a hell of a lot more than PC's and are no way as good, they have very little upgradability and I hate them! I may just be stating the obvious but the laptop market seriously needs to improve a lot in my eyes before I should consider getting one.

Being able to make your own laptop would make me consider getting one, if it is possible?
    
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post #6 of 10
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Originally Posted by TheFatBloke View Post
Seriously there are so many people out there with Laptops it is unbelievable. I read somewhere more people now own laptops than PC's and the thing is Laptops are terrible! Cost a hell of a lot more than PC's and are no way as good, they have very little upgradability and I hate them! I may just be stating the obvious but the laptop market seriously needs to improve a lot in my eyes before I should consider getting one.

Being able to make your own laptop would make me consider getting one, if it is possible?
All people want is something that works, it small, light weight, quiet, and look good. A.K.A a laptop.
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post #7 of 10
Quote:
Originally Posted by TheFatBloke View Post
Seriously there are so many people out there with Laptops it is unbelievable. I read somewhere more people now own laptops than PC's and the thing is Laptops are terrible! Cost a hell of a lot more than PC's and are no way as good, they have very little upgradability and I hate them! I may just be stating the obvious but the laptop market seriously needs to improve a lot in my eyes before I should consider getting one.

Being able to make your own laptop would make me consider getting one, if it is possible?
That is not true what so ever i don't see anything wrong with laptops. They fill there market for what people want. I will always have a desktop around for certain things such as gaming but laptops are really coming around. Now you can get desktop replacements that will in some/rare cases out perform a desktop. I understand that a laptops parts are underclocked and all but they fit what they are needed for.

In two years i will go to college and I will be buying a MacBook Pro so i can drag it around everywhere with me. You can't say laptops will take over the market completely but I can see where you are coming from.
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post #8 of 10
Quote:
Originally Posted by TheFatBloke View Post
Seriously there are so many people out there with Laptops it is unbelievable. I read somewhere more people now own laptops than PC's and the thing is Laptops are terrible! Cost a hell of a lot more than PC's and are no way as good, they have very little upgradability and I hate them! I may just be stating the obvious but the laptop market seriously needs to improve a lot in my eyes before I should consider getting one.

Being able to make your own laptop would make me consider getting one, if it is possible?
Hah!

My laptop would completely kill your desktop!

Slow...? Please.
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post #9 of 10
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Originally Posted by mactard View Post
Hah!

My laptop would completely kill your desktop!

Slow...? Please.
My desktop is worth £100. Its a piece of *****, so theres no real argument there, any new laptop / pc is better than mine. Medium - High End PC's > Laptops that aren't over $2000
    
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post #10 of 10
Ehh, I think AMD has a decently strong hold on the budget market. With the pricedrop on the 22nd, it'll be cut down a little but though there are always fans of the company that'll take them over anything else just because that's what fans do. Really though, I hope that AMD is forced to sell out to IBM or someone that'll have the backing to REALLY push against Intel.
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