By Anna Prior and Don Clark
Intel Corp. reported a decline in first-quarter profit as the
Silicon Valley chip maker continues to share the pain of the
shrinking personal computer market.
Revenue edged higher, and the company's closely watched gross
profit margin was 59.7% in the quarter, down from 62% in the fourth
period but ahead of Intel's 59% projection.
Intel, based in Santa Clara, Calif., supplies most of the chips
that serve as calculating engines in PCs and server systems. The
company has suffered as customer spending has shifted from laptop
computers to tablets and smartphones.
The research firm IDC last week said global PC unit shipments
declined 4.4% in the first quarter, while rival Gartner put the
decline at 1.7%.
Brian Krzanich, who was named Intel's chief executive in May,
has tried to accelerate Intel's push beyond the PC, vowing to sell
40 million chips for tablets in 2014. He has also emphasized the
possibilities presented by wearable devices and other everyday
products known collectively as the Internet of Things.
In all, Intel reported net income of $1.95 billion, or 38 cents
a share, compared with a profit in the year-earlier period of $2.05
billion, or 40 cents a share. Analysts had expected earnings per
share of 37 cents, according to Thomson Reuters.
Revenue climbed to $12.76 billion; Intel in January had
projected $12.8 billion, plus or minus $500 million.
For the second quarter, Intel said it expects revenue of $13
billion, plus or minus $500 million, and estimated its gross margin
at about 63%. Analysts were looking for revenue of $12.96
billion.
Write to Anna Prior at anna.prior@wsj.com and Don Clark at
don.clark@wsj.com
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