Intel 's first-quarter profits jumped 89 percent and revenues grew 20 percent as worldwide business spending on the silicon chips that power computers improved.

Intel also said Tuesday it expects the current quarter's revenues to be between US$7.6 billion and US$8.2 billion. The midpoint is below analysts' consensus expectation of US$8.09 billion, but above typical seasonal declines in the second quarter, one of the weakest of the year.

"Intel's first quarter results showed healthy growth in both revenue and earnings compared to a year ago, led by improvement in worldwide [information technology] spending," said Craig Barrett, Intel's chief executive.

For the three months ended March 27, Intel reported a profit of US$1.73 billion, or US$0.26 per share, compared with a profit of US$915 million, or US$0.14 per share, in the same period a year ago.

Sales rose to US$8.09 billion, compared with US$6.75 billion in the first quarter of last year.

The results include a US$0.017-per-share charge from Intel's US$225 million payment to Intergraph Corp to settle a long-running patent dispute. The agreement was announced March 30.

Analysts expected Intel to earn a profit of US$0.27 per share on sales of US$8.16 billion, according to a survey by Thomson First Call. In January, the Santa Clara, California-based company predicted first-quarter sales of between US$7.9 billion and US$8.5 billion.

In an interview, chief financial officer Andy Bryant said revenues grew in every part of the world.

"Everybody contributed to that 20 percent [sales] growth. It's not` just emerging markets anymore. It's Europe and the US well," he said.

In January, Intel said demand for microprocessors was at the lower end of seasonal expectations. Analysts believed that was due to a temporary and unexpected buildup of notebook computer inventory.

"We believe that's resolved itself," Bryant said. "We don't see any of the excess mobile inventory at this point."

John Lau, an analyst at Banc of America Securities LLC, said it appears demand has picked up for notebooks and burned off any excess parts.

"As a result, we see the next generation notebook processor remains on schedule for volume delivery in May," he said. "That wouldn't occur if there was still excess inventory of older parts in the channel."

The company said shipments of microprocessors declined over the fourth quarter, as did chipsets and motherboards. Processors, however, had a slightly higher average selling price

By: DocMemory
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