EU fine knocks $2 billion off Intel's income

 

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Posted on 15 Jul 2009 at 10:57

Intel's net income for the second quarter of 2009 has dropped $2 billion on the back of the huge fine delivered by the EU for anti-competitive practices.

The European Commission fined Intel $1.44 billion for attempting to squeeze rival AMD out of the processor market by offering huge rebates to PC makers in return for delaying, or denying, sales of AMD chips.

The fine saw the chip giant post a second-quarter loss of $398 million compared to a profit of $1.6 billion in the same period last year. It wasn't all bad news for the company, which posted revenues of $8 billion, a rise of $879 million on the first quarter.

"Intel's second-quarter results reflect improving conditions in the PC market segment with our strongest first- to second-quarter growth since 1988 and a clear expectation for a seasonally stronger second half," says Paul Otellini, Intel's CEO.

Otellini has predicted revenues for the third quarter of around $8.5 billion, claiming consumer sales would help prop up a still-faltering enterprise market. However, he remains confident demand will pick up next year.

Evidence of the strong consumer sales could be found in the company's Atom income. Profits rose $362 million, a 65% increase on the last year, driven by netbook shipments.

Author: Stuart Turton