$2bn wiped off Intel's expected revenue

 

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By Barry Collins

Posted on 8 Jan 2009 at 08:42

Intel has warned that its Q4 revenues will be $2bn lower than the company first predicted.

The world's leading chip maker has dropped its revenue forecast to $8.2 billion - a fall of almost a quarter on the same period last year.

In October the company predicted revenue of between $10.1 billion to $10.9 billion, and had already lowered that forecast to $9 billion in November.

The company is blaming "further weakness in end demand and inventory reductions by its customers in the global PC supply chain" for the shortfall.

Analysts say Intel's revised figures are bad news for the entire PC industry. "Clearly we are going to be in an ugly period for corporate earnings," Tim Ghriskey, an analyst with Solaris Asset Management told Reuters. "Intel being a bellwether for the industry it will take the industry down as well."

Others claim the sharp fall in revenue was only to be expected."If you are surprised by this news, then you've been on a desert island," Walter Todd, portfolio manager at Greenwood Capital Associates told Reuters. "We all know the economy is weak,"

"If you're holding Intel today... it's because this is a leading industry player with a great balance sheet and longer-term it will really look great. But 2009 for Intel and others in technology, and outside of technology, will be a very rough earnings year."