Intel raised its quarterly revenue outlook after citing strong worldwide demand for its microprocessors and reduced levels of inventories to send its shares up more than 7 per cent in after-hours trading.
Fourth-quarter revenue is now expected to reach $9.3 billion to $9.5 billion, up from an earlier target of $8.6 billion to $9.2 billion. At those levels, Intel will set a new all-time high, breaking a record of $8.74 billion set in last year's fourth quarter.
The news came as a welcome relief for the chip maker, which recently cancelled plans for a higher speed Pentium 4 chip for desktop computers and abandoned a widely promoted foray into television chips.
Intel, whose chips run about 80 per cent of the world's personal computers, has also been losing market share to rival Advanced Micro Devices (AMD). Intel's shares have fallen 29 per cent this year, while AMD has seen its shares rise by more than 50 per cent.
The market's reaction to the scheduled revenue outlook update was broadly positive, with network equipment maker Cisco Systems , Dell and Applied Materials all rising in after-hours trading.
Intel also said it is reviewing whether to repatriate up to $6 billion in earnings from offshore subsidiaries that may be eligible for repatriation at a lower tax rate under a new federal law.