AMDDeathstar
01-15-2008, 05:56 PM
Goes to show traders don't care if you have better product or make profit.
Intel made 2.27 billion profit in the 4th quarter but it wasn't good enough after market trading Intel stock went from $22.69 to $19.47
Wall Street got to get rid of "analysts' estimates", too many profitable companies get their stock hammered because of these idoits wrong predictions.
Bloomberg Soure (http://www.bloomberg.com/apps/news?pid=20601087&sid=aM1g84QgJ_40&refer=home)
Intel's Revenue Forecast Falls Short; Shares Slump (Update3)
By Ian King
Jan. 15 (Bloomberg) -- Intel Corp. posted fourth-quarter sales that missed analysts' estimates and gave a forecast that disappointed investors, prompting a 14 percent plunge in the shares and signaling that electronics demand is slipping.
The world's largest chipmaker said prices for memory used in music players trailed its projections, crimping total sales growth to 11 percent over the holiday season. First-quarter revenue will rise to as little $9.4 billion, short of analysts' estimates of $10.1 billion.
The report fuels concern that technology spending is being hurt by an increase in customers' borrowing costs and slowing economic growth. Chief Executive Officer Paul Otellini, who boosted sales 8.3 percent last year after losing ground to Advanced Micro Devices Inc. in 2006, is now looking to emerging markets such as China for growth.
``We are perhaps a little bit cautious looking at the U.S. economy,'' Intel Chief Financial Officer Stacy Smith said in a telephone interview. ``We didn't see signs of slowing, but certainly the macroeconomic indicators that are out there would say to be a little bit cautious.''
Fourth-quarter net income increased 51 percent to $2.27 billion, or 38 cents a share, Santa Clara, California-based Intel said today. Sales rose to $10.7 billion, missing analysts' estimates of $10.8 billion.
Intel dropped $3.22 to $19.47 in extended trading. The stock fell 39 cents, or 1.7 percent, to $22.69 in regular trading on the Nasdaq Stock Market. Intel shares have declined 15 percent this year. Advanced Micro fell 41 cents, or 6.7 percent, to $5.71 in extended trading on the New York Stock Exchange.
More Conservative
``They're guiding more conservatively on the revenue side than the Street expected,'' said Pat Becker Jr., who helps manage about $2.5 billion including Intel shares at Becker Capital Management in Portland, Oregon. ``They wanted to give themselves some wiggle room.''
Intel, whose sales are seen as an indicator of overall computer demand, kicked off the earnings season for U.S. technology companies. The report contrasted with preliminary earnings from International Business Machines Corp., which said yesterday that fourth-quarter profit and sales topped estimates.
Analysts had predicted Intel would report net income of $2.36 billion, or 39 cents a share, according to a Bloomberg survey. Intel said it wrote down the value of its flash-memory chip making assets that will be part of a joint venture with STMicroelectronics NV. The expense and others costs reduced earnings per share by 2.5 cents in the quarter.
Sales Miss
Sales missed the midpoint of Intel's forecast range by $88 million because revenue from another type of flash memory, called Nand, was hit by lower prices. Nand memory is used in music players and digital cameras. Intel's Smith said revenue from computer chips met expectations.
Gross margin, or the percentage of sales remaining after subtracting the cost of production, was 58 percent in the fourth quarter. Intel expects that indicator of profitability to narrow to about 56 percent in the first quarter.
For the year, Intel forecast a gross margin of about 57 percent. It plans to spend about $5.2 billion on new plants and equipment in 2008, and about $5.9 billion on research and development.
Demand for personal computers weakened last quarter, just as chip shipments increased the most in eight years, said JPMorgan Securities Inc. analyst Christopher Danely. He cut his rating on Intel shares to ``neutral'' from ``overweight'' on Jan. 4.
Unused Inventory
Intel and Advanced Micro shipped about 20 percent more chips in each of the past two quarters than a year earlier, the biggest increases since at least 2000, Danely said. Demand isn't keeping up, leaving unused inventory, he said.
Otellini, 57, told analysts on a conference call that he wants to raise Intel's inventory levels and that he hasn't heard of any buildup of unused parts at customers.
Most of Intel's growth is coming from countries outside the U.S., which account for more than 75 percent of sales, Otellini said. Chinese sales ``continue to boom,'' he said.
In the fourth quarter, Asia-Pacific sales, which make up half of total revenue, rose 9.9 percent to $5.34 billion. Sales in the Americas rose 4.7 percent to $2.1 billion.
Intel made 2.27 billion profit in the 4th quarter but it wasn't good enough after market trading Intel stock went from $22.69 to $19.47
Wall Street got to get rid of "analysts' estimates", too many profitable companies get their stock hammered because of these idoits wrong predictions.
Bloomberg Soure (http://www.bloomberg.com/apps/news?pid=20601087&sid=aM1g84QgJ_40&refer=home)
Intel's Revenue Forecast Falls Short; Shares Slump (Update3)
By Ian King
Jan. 15 (Bloomberg) -- Intel Corp. posted fourth-quarter sales that missed analysts' estimates and gave a forecast that disappointed investors, prompting a 14 percent plunge in the shares and signaling that electronics demand is slipping.
The world's largest chipmaker said prices for memory used in music players trailed its projections, crimping total sales growth to 11 percent over the holiday season. First-quarter revenue will rise to as little $9.4 billion, short of analysts' estimates of $10.1 billion.
The report fuels concern that technology spending is being hurt by an increase in customers' borrowing costs and slowing economic growth. Chief Executive Officer Paul Otellini, who boosted sales 8.3 percent last year after losing ground to Advanced Micro Devices Inc. in 2006, is now looking to emerging markets such as China for growth.
``We are perhaps a little bit cautious looking at the U.S. economy,'' Intel Chief Financial Officer Stacy Smith said in a telephone interview. ``We didn't see signs of slowing, but certainly the macroeconomic indicators that are out there would say to be a little bit cautious.''
Fourth-quarter net income increased 51 percent to $2.27 billion, or 38 cents a share, Santa Clara, California-based Intel said today. Sales rose to $10.7 billion, missing analysts' estimates of $10.8 billion.
Intel dropped $3.22 to $19.47 in extended trading. The stock fell 39 cents, or 1.7 percent, to $22.69 in regular trading on the Nasdaq Stock Market. Intel shares have declined 15 percent this year. Advanced Micro fell 41 cents, or 6.7 percent, to $5.71 in extended trading on the New York Stock Exchange.
More Conservative
``They're guiding more conservatively on the revenue side than the Street expected,'' said Pat Becker Jr., who helps manage about $2.5 billion including Intel shares at Becker Capital Management in Portland, Oregon. ``They wanted to give themselves some wiggle room.''
Intel, whose sales are seen as an indicator of overall computer demand, kicked off the earnings season for U.S. technology companies. The report contrasted with preliminary earnings from International Business Machines Corp., which said yesterday that fourth-quarter profit and sales topped estimates.
Analysts had predicted Intel would report net income of $2.36 billion, or 39 cents a share, according to a Bloomberg survey. Intel said it wrote down the value of its flash-memory chip making assets that will be part of a joint venture with STMicroelectronics NV. The expense and others costs reduced earnings per share by 2.5 cents in the quarter.
Sales Miss
Sales missed the midpoint of Intel's forecast range by $88 million because revenue from another type of flash memory, called Nand, was hit by lower prices. Nand memory is used in music players and digital cameras. Intel's Smith said revenue from computer chips met expectations.
Gross margin, or the percentage of sales remaining after subtracting the cost of production, was 58 percent in the fourth quarter. Intel expects that indicator of profitability to narrow to about 56 percent in the first quarter.
For the year, Intel forecast a gross margin of about 57 percent. It plans to spend about $5.2 billion on new plants and equipment in 2008, and about $5.9 billion on research and development.
Demand for personal computers weakened last quarter, just as chip shipments increased the most in eight years, said JPMorgan Securities Inc. analyst Christopher Danely. He cut his rating on Intel shares to ``neutral'' from ``overweight'' on Jan. 4.
Unused Inventory
Intel and Advanced Micro shipped about 20 percent more chips in each of the past two quarters than a year earlier, the biggest increases since at least 2000, Danely said. Demand isn't keeping up, leaving unused inventory, he said.
Otellini, 57, told analysts on a conference call that he wants to raise Intel's inventory levels and that he hasn't heard of any buildup of unused parts at customers.
Most of Intel's growth is coming from countries outside the U.S., which account for more than 75 percent of sales, Otellini said. Chinese sales ``continue to boom,'' he said.
In the fourth quarter, Asia-Pacific sales, which make up half of total revenue, rose 9.9 percent to $5.34 billion. Sales in the Americas rose 4.7 percent to $2.1 billion.