Close
  • Latest News
  • Artificial Intelligence
  • Video
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
Read Down
Sign in
Close
Welcome!Log into your account
Forgot your password?
Read Down
Password recovery
Recover your password
Close
Search
Logo
Logo
  • Latest News
  • Artificial Intelligence
  • Video
  • Big Data and Analytics
  • Cloud
  • Networking
  • Cybersecurity
  • Applications
  • IT Management
  • Storage
  • Sponsored
  • Mobile
  • Small Business
  • Development
  • Database
  • Servers
  • Android
  • Apple
  • Innovation
  • Blogs
  • PC Hardware
  • Reviews
  • Search Engines
  • Virtualization
More
    Home IT Management
    • IT Management
    • Networking
    • PC Hardware

    Intel Atom Processor Brings Good News amid Dismal Q4 Results

    Written by

    Scott Ferguson
    Published January 15, 2009
    Share
    Facebook
    Twitter
    Linkedin

      eWEEK content and product recommendations are editorially independent. We may make money when you click on links to our partners. Learn More.

      Intel, the world’s largest supplier of microprocessors for PCs and servers, watched its 2008 fourth-quarter revenue and profits drop dramatically as the U.S. recession and the larger global economy continues to have a major impact within the IT industry, especially on PC and server sales.

      During its fourth-quarter sales period, which ended Dec. 27, Intel recorded revenue of $8.2 billion, and the company reported net income of $234 million or 4 cents per share. By comparison, Intel reported a net income of $2.3 billion or 38 cents per share in the fourth quarter of 2007, with revenues of $10.71 billion. Intel also had to write down a $1 billion reduction in the value of its Clearwire investment during the last three months of 2008.

      Intel’s 2008 fourth-quarter numbers were in line with what Wall Street analysts had been expecting, and Intel did warn investors both in November 2008 and earlier in January 2009 that its revenues would suffer during the quarter. Still, Intel’s latest results showed how the global economy and the financial situation in the United States has been affecting IT companies and that even stalwarts such as Intel, Google and Oracle are not immune.

      “The pace of the revenue decline in the quarter was dramatic,” said CEO Paul Otellini during a Jan. 15 conference call with financial analysts to discuss the latest numbers. “These numbers resulted from reduced demand and contractions across the supply chain. While inventories have declined, we are assuming further reduction in [the first quarter of 2009].”

      Otellini and his management team did not offer any financial guidance for the first quarter of 2009, due to ongoing uncertainty about the economy and IT and consumer spending. However, Intel did note that for internal purposes the company is estimating revenue of $7 billion for the first quarter of 2009, which is in line with Wall Street estimates of $7.2 billion.

      Otellini did not speculate on whether Intel would cut the price of its processors to help reduce its chip inventory, although the CEO noted that the ASPs (average selling prices) of the company’s microprocessors remained flat during the quarter.

      Intel does plan to spend money and invest in new technology in 2009, including ramping up its production of 32-nanometer “Westmere” processors. The first of these processors could appear in desktops and notebook by the end of 2009. For the year, Intel plans to spend about $5.4 billion on R&D.

      “I think the important thing is that, despite the slowdown in [the fourth quarter of 2008] and what looks to be a very tough first half [of] 2009, Intel is continuing forward with important projects like the 32-nanometer manufacturing rollout,” John Spooner, an analyst with Technology Business Research, wrote in an e-mail. “Sure it’s going to manage expenses very carefully in 2009, but it won’t sacrifice the fates of new products on the altar of what it sees as more of a correction.”

      The one bright spot for Intel during the quarter involved its Atom processor and platforms for mininotebooks or “netbooks” and MIDs (mobile Internet devices). Revenue from Atom processors and chip sets shot up 50 percent from the third quarter of 2008 to the fourth quarter, and these parts pulled in $300 million in revenue for Intel. At the recent International CES expo in Las Vegas, nearly every PC vendor offered a new version of a netbook or mininotebook, nearly all of which used an Intel Atom processor.

      While some observers have speculated that the Intel Atom processor actually reduces sales of older Intel chips, such as the Celeron processor, Otellini said Atom is creating its own market.

      “While there is some cannibalization, the data suggests that the vast majority of netbooks sales are incremental,” Otellini said.

      During the call, Otellini was asked about other platforms and processors that have been created for others types of netbooks, mininotebooks and ultraportable laptops. While he did not mention any other platforms specifically, he said these offerings justified the market Intel created with Atom.

      During CES, Advanced Micro Devices rolled out its “Yukon” platform for ultraportable, affordable notebooks, and companies such as Freescale Semiconductor, Texas Instruments and Qualcomm are offering their own netbook and MID platforms that use ARM chips.

      Scott Ferguson
      Scott Ferguson

      Get the Free Newsletter!

      Subscribe to Daily Tech Insider for top news, trends & analysis

      Get the Free Newsletter!

      Subscribe to Daily Tech Insider for top news, trends & analysis

      MOST POPULAR ARTICLES

      Artificial Intelligence

      9 Best AI 3D Generators You Need...

      Sam Rinko - June 25, 2024 0
      AI 3D Generators are powerful tools for many different industries. Discover the best AI 3D Generators, and learn which is best for your specific use case.
      Read more
      Cloud

      RingCentral Expands Its Collaboration Platform

      Zeus Kerravala - November 22, 2023 0
      RingCentral adds AI-enabled contact center and hybrid event products to its suite of collaboration services.
      Read more
      Artificial Intelligence

      8 Best AI Data Analytics Software &...

      Aminu Abdullahi - January 18, 2024 0
      Learn the top AI data analytics software to use. Compare AI data analytics solutions & features to make the best choice for your business.
      Read more
      Latest News

      Zeus Kerravala on Networking: Multicloud, 5G, and...

      James Maguire - December 16, 2022 0
      I spoke with Zeus Kerravala, industry analyst at ZK Research, about the rapid changes in enterprise networking, as tech advances and digital transformation prompt...
      Read more
      Video

      Datadog President Amit Agarwal on Trends in...

      James Maguire - November 11, 2022 0
      I spoke with Amit Agarwal, President of Datadog, about infrastructure observability, from current trends to key challenges to the future of this rapidly growing...
      Read more
      Logo

      eWeek has the latest technology news and analysis, buying guides, and product reviews for IT professionals and technology buyers. The site’s focus is on innovative solutions and covering in-depth technical content. eWeek stays on the cutting edge of technology news and IT trends through interviews and expert analysis. Gain insight from top innovators and thought leaders in the fields of IT, business, enterprise software, startups, and more.

      Facebook
      Linkedin
      RSS
      Twitter
      Youtube

      Advertisers

      Advertise with TechnologyAdvice on eWeek and our other IT-focused platforms.

      Advertise with Us

      Menu

      • About eWeek
      • Subscribe to our Newsletter
      • Latest News

      Our Brands

      • Privacy Policy
      • Terms
      • About
      • Contact
      • Advertise
      • Sitemap
      • California – Do Not Sell My Information

      Property of TechnologyAdvice.
      © 2024 TechnologyAdvice. All Rights Reserved

      Advertiser Disclosure: Some of the products that appear on this site are from companies from which TechnologyAdvice receives compensation. This compensation may impact how and where products appear on this site including, for example, the order in which they appear. TechnologyAdvice does not include all companies or all types of products available in the marketplace.

      ×