Datacenter Chip Team Leads Intel Record Q1 2011

Posted by at 11:14 am on April 20, 2011

Intel posted record results on Tuesday that also cast doubt on claims of tablets hurting the market. Its revenue was up 25 percent to $12.8 billion and its net profit up by 29 percent to $3.3 billion. Most of that growth came from its datacenter chip team (Xeon), whose revenue was up 32 percent, but it still saw its core PC chip group’s revenue up by 17 percent as the second-generation Core (Sandy Bridge) take off.

Even the Atom processor group saw its revenue up four percent versus early 2010, when the iPad had been unveiled but hadn’t shipped. Intel did admit that the average selling price of a chip was up from quarter-to-quarter as more portable buyers steered towards regular notebooks.

The broad increases were slightly tempered by a flat outlook where revenue would stay the same and profit would drop slightly to $3.2 billion.

CEO Paul Otellini defended the traditional computer during a fiscal results call that also challenged analyst groups like Gartner and IDC on their claims of tablets cannibalizing PC sales. Third party researchers often didn’t account for sales from developing countries, he said. A greater number of generic PCs and individual component sales make it harder to track sales than in wealthier nations, where more PCs sell from major brands. Intel as the chip designer for most companies was often the most accurate source and saw modest but ongoing growth.

“Our projections for PC segment growth in 2011 remain in the low double-digit range, based on early sell-through strength we are seeing as we begin 2011,” Otellini said during the call. “While it’s too early to call 2012, with an improving global economy, we see no reason for growth to be materially different from what we see in 2011.”

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