Intel today turned in record fourth quarter revenue and then saw investors pummel its share price in after-hours trading. Thank for the effort, guys.
The chip maker posted an 11 per cent rise in revenue to $10.7bn. It also kicked net income higher by a whopping 51 per cent to $2.3bn. But these flashy figures fell below the midpoint of Intel's previous guidance and below analysts' expectations, leaving already rattled investors with the motivation to sell.
At the time of writing, Intel's shares - down 1.7 per cent during regular trading - had tumbled more than 14 per cent to $19.52.
During the fourth quarter, sales of Intel's server and desktop chips rose to $4.3bn from $3.9bn in the same period last year. Chipset and motherboard revenue rose as well to $1.4bn.
Sales of notebook chips edged higher to $3.0bn from $2.7bn as mobile chipset sales jumped to $1.1bn from $925m.
In addition to missing the high-end of previous guidance, Intel seemed to spook investors with its outlook for the coming year. The company expects first quarter revenue between $9.4bn and $10bn. In the 2007 first quarter, Intel reported revenue of $8.9bn.
We read Intel CEO Paul Otellini's comments made during a conference call as far less pessimistic than other media types appear to have taken them.
Everyone in the US is gripped with fear over a supposed impending recession and seems ready to take any hesitation about the macroeconomic situation as proof that the end is near.
For example, one analyst claimed that Otellini voiced "concerns" about the US economy, appearing to almost want the statement to be true.
"I don't think I said 'I have concerns,'" Otellini countered. "I said I have the same caution as everyone in America who watches (financial news on TV)."
He confirmed concerns about the US capital markets but said he "just doesn't see" these worries hurting sales of technology products at the moment.
Overall, Otellini put forward the idea that Intel has a very watchful eye on the economies here and abroad but that sales of chips have been moving along just fine. ®