Intel's profits plunge 90 per cent

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Intel reported late yesterday one of it worst quarters in its history, as profit for its fourth quarter nosedived 90 per cent.

The chipmaker said it had made $234 million (£157 million) net profit for the quarter ended 27 December 2008, compared to $2.27 billion (£1.5 billion) in the same quarter of last year.

The figures also fell short of analyst expectations of $257 million (£172 million) net profit for the quarter, but was in line with its own, lowered revenue forecast of $8.2 billion (£5.5 billion).

But total revenue, including from microprocessors and chipsets, was still down 23 per cent year-on-year and 19 per cent from the previous quarter.

The figures included a loss of $1.1 billion (£736 million) from equity investments and interest, primarily due to a billion-dollar reduction in the value of Intel's investments in Clearwire, Intel said.

It also chose not to give any guidance on revenue for the first quarter of 2009, blaming "economic uncertainty and limited visibility”.

And it said it had taken steps to mitigate the affect of the global slowdown by entering new markets and cutting its operational costs by about $3 billion (£2 billion) since 2006.

Paul Otellini, Intel president and chief executive, said that restructuring the firm had saved $800 million (£535 million) in 2008, with three per cent fewer staff, now totalling 84,000 employees.

"Intel has weathered difficult times in the past, and we know what needs to be done to drive our success moving forward," Otellini said.

He added that 32-nanometer process technology development would be accelerated to reduce chip-manufacturing costs and make integrated chips for the likes of set-top boxes and televisions as well.

And the chipmaker also said its new Nehalem chip microarchitecture should start appearing in more desktops and laptops by the second half of the year, having launched its first Nehalem-based Core i7 chips for high-end gaming desktops in November.

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