Intel Loses 35 Percent in Third Quarter Earnings

Intel Corp. on Tuesday October 17 announced third quarter earnings that fell 35 percent with revenue down 12 percent. Based in Santa Clara, California, the chip maker reported earnings of 22 cents a share or $1.3 billion.

The quarter saw the first shipments of Intel's new "quad-core" processor, chips with four computing cores designed to deliver enhanced performance over previous dual core chips. The quad-core chips represent the company's first new architecture in five years and the shipments beat out similar projected products by rival Advanced Micro Devices Inc. by several months. No AMD quad-core chips are expected to appear until the middle of 2007.

Speaking to the Associated Press, Intel's Chief Financial Officer Andy Bryant said, "We still have to live with tough year-over-year comparisons . . . but we think the worst is behind us."

At the close of the New York market Intel shares were down 3.2 percent to $20.90 but in after hours trading they gained 1 percent.

Intel's chief executive officer Paul Otellini, 56, has aggressively offered discounts to move old chips out of inventory and to make room for new models to win back the company's market share. In addition, the company plans to divest itself of some 10,500 workers beginning in 2008 to trim down its work force.

Currently Intel's market share is the lowest in more than four years with approximately 72.9 percent of personal computer processors, down from a figure of 82.2 percent a year ago according to figures compiled by Mercury Research of Cave Creek, Arizona.