Intel 2nd-Quarter Net Down 29%; Lowers Full-Year Revenue Outlook

   By Kristin Jones 
 

Intel Corp.'s (INTC) second-quarter profit fell 29% as the chip maker continued to be hurt by sinking demand for personal computers.

The company lowered its full-year revenue outlook, now seeing its sales roughly flat from the previous year. Intel previously expected sales growth at a low single-digit percentage.

Intel has struggled to come to terms with fizzling demand for PCs, and its sluggishness in entering the mobile market has frustrated investors. Chief Executive Brian Krzanich, a company veteran who was named to the top post in May, has pledged to step up Intel's push to get its chips into smartphones and tablets.

Mr. Krzanich on Wednesday reiterated the company's priority on creating products for the ultra-mobile market.

For the latest quarter, Intel reported a profit of $2 billion, or 39 cents a share, down from $2.83 billion, or 54 cents a share, a year earlier. Analysts polled by Thomson Reuters were expecting per-share earnings of 39 cents.

Sales fell 5.1% to $12.8 billion, in line with the $12.4 billion to $13.4 billion Intel projected in April.

Gross margin, a closely watched figure for Intel and other chip makers, narrowed to 58.3% from 63.4%.

Sales in the company's PC client group, which makes up most of the top line, shrank 7.5%, while data-center revenue was roughly flat. The other Intel architecture segment, which includes mobile chips, posted 15% lower revenue.

Operating expenses edged up 0.6% to $4.75 billion.

For the current quarter, Intel expects revenue of $13 billion to $14 billion, bracketing the $13.7 billion expected by analysts.

Shares closed Wednesday at $24.15 and were up seven cents after hours. Through the close, the stock was up 17% since the start of the year.

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