Intel Says PC Sales ‘Bottomed Out’ in Quarter

[endarkenment]

Source: New York Times


Intel reported on Tuesday that first-quarter net income fell 55 percent to $647 million, or 11 cents a share, on revenue of $7.1 billion.

A consensus of Wall Street had estimated that Intel would report revenue of $6.98 billion.

But Paul Otellini, Intel’s chief executive, cast the results in an optimistic light. “We believe PC sales bottomed out during the first quarter and that the industry is returning to normal seasonal patterns."

Read more: http://www.nytimes.com/2009/04/15/technology/companies/15chip.html?ref=technology

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Net income down a staggering 55%. Yikes. But the theme for April is 'bottomed out'.

[Warpy]

1. Combination of market saturation and an OS that was

rushed to market prematurely. It's easy to see why sales hit the skids.

Now if they would start licensing XP machines again, maybe sales would pick up. I know there are a lot of people out there nursing old machines along who'd probably like to upgrade or replace.

[Deja Q]

2. Or people waiting for WIndows 7...

I hope Vista users get a good discount; what with all the original features dropped and all those bugs that existed in the RTM release, not fixed until the rather late release of SP1... and the lack of "Ultimate" features as promised to people who shelled out the big bucks...

[roseBudd]

3. I went for vista home ultimate in a core duo with 4 GB of RAM & I could not be happier...

I can't say what the experience might have been if I hadn't the hardware for it, but the hardware is so inexpensive I don't know why anyone would have less than 3GB.

[Egnever]

4. It runs fine as long as you aren't really using it.

3gig does seem to be the sweet spot. Having said that there are all sorts of performance issues that a normal user wouldn't run into in daily operation. When it first started shipping a gig of memory was standard and that doesn't even begin to address the needs of the power hungry vista. There are a lot of people out there that bought those systems not knowing any better and right this very minute are sitting wondering why their computer is so slow.

The same thing happened with the release of xp, I cant tell you how many machines i have worked on that shipped with 256k ram with xp professional. XP if given the opportunity will eat almost 400 megs all by itself on a blank install. When XP was released many refused to move to it as well.

Microsoft's biggest error in both launches IMHO was its ridiculous minimum specs.

[roseBudd]

9. I am an multiple Adobe apps power user & my XP box at work chokes but never Vista...

I also got the 64 bit OS

[Egnever]

12. Well Adobe apps are fairly specific

And again as long as you have the machine to push it you will see few problems. However there are all kinds of quirks you aren't encountering. Networking on release could be nightmarish. Some xp boxes were seen others weren't. Some can share files correctly and easily others had to be locked down to specific ip settings for networking to function correctly. There is still an issue on many machines with USB file transfers being horribly slow. And myriad other issues many to do with faulty drivers but just the same the average user has no clue how to address these things.

Adobe is not really that difficult to run well it just takes horsepower. The 64 bit OS does help though. There is 64 bit xp as well though and i'll bet you dollars to donuts that if you wiped vista off that box and re-installed xp64 it would run better. It sure wouldn't look as pretty though :P

[roseBudd]

13. I have to admit I do like the pretty, I have XP at work so pretty for home is good....

Actually I run Bootcamp on an iMac because I'm a PC through & through.

[SkyDaddy7]

8. I love VISTA!

[Warpy]

10. You're allowed to.

Most IT professionals don't and, like I said, it requires more expensive hardware to run.

[SkyDaddy7]

14. Yes, I agree...

I did build my computer to run it. I see both sides I was just expressing my personal opinion about VISTA.

Do you know much about Windows 7?

[Lance_Boyle]

15. This is Intel, not Microsoft.

Intel's earnings have almost absolutely zero to do with Microsoft's operating systems, or Apple's, or anyone else's.

[Warpy]

16. Actually, they do

because a drop in computer sales does affect their own sales.

[Lance_Boyle]

20. Do you have any idea what percentage of Intel's revenue

comes from "Desktop PC" processors?

Hint - it's not as much as you think.

[ixion]

5. "normal seasonal patterns."

that's the problem. They continue to maintain false hopes that everything will return to normal. It will not, IMO.

[phantom power]

7. Yeah, that sounds like whistling past the graveyard.

Like the automakers hoping auto sales will return to 2006 levels again. Demand for just about everything is going to be at lower levels for some time.

[Sen. Walter Sobchak]

6. I would think the Atom is part of the problem

What percentage of Intel's sales are of the low-cost Atom processor, which is showing up in more and more places than Intel ever would have wished including desktops and higher-end sub-notebooks. Mobile processors used to be a profit center, now a great big chunk of the market is being consumed by the $30 Atom processor.

[CatholicEdHead]

11. Also some servers use the Atom

You make multi-CPU Servers and you can get the same CPU output of one Server chip and actually save energy.

Edit: They are out on home servers already and Microsoft is trying them out in their datacenters.

http://www.pcworld.com/businesscenter/article/160438/intel_atom_may_power_green_servers.html

[Romulox]

17. The biggest problem is that there has been little in the way of compelling new software in years

My 4 year old laptop can handle all the apps that I need just fine. And since PC gaming is essentially dead, there is little need for the average user to upgrade one's PC ever 18 months.

[w4rma]

18. They outsourced the programming industry. Therefore, noone makes new innovative software. (nt)

[Romulox]

19. I agree. That's probably true of ALL outsourced industries, across the board.