All's Well at Intel

Whew! You could hear Tech sector's sigh of relief all over the land.

Any slowdown in the semiconductor industry due to a weak economic climate appears to be isolated to Advanced Micro Devices so far.

Intel, the biggest chipmaker, reported first-quarter results that were largely in line with analysts' expectations, and it offered a strong outlook for the second quarter as well. It earned $1.4 billion, or 25 cents per share, on revenue of $9.7 billion. Sales were up 9 percent, while net income dropped by 12 percent due to restructuring charges.

"Our first-quarter results demonstrate a strengthening core business and a solid global market environment," said Intel chief executive Paul Otellini in a statement. "We saw healthy demand for our leading-edge processors and chipsets across all segments."

Plenty of technology analysts were worried that current recessionary pressure would hurt computer sales and orders for new chips. Those concerns were underscored last week, when the No. 2 chipmaker, A.M.D., said that its first-quarter sales would fall short of expectations.

"People might now say maybe it's safe to put your feet in the water here,'' Raymond James equity analyst Hans Mosesmann told Bloomberg of Intel. "They have a super product lineup, and A.M.D. is in a death spiral.''

Investors were certainly pleased with the news. Shares of Intel jumped 7 percent in after-hours trading.

http://www.portfolio.com/news-markets/top-5/2008/04/15/Intel-Earnings