Intel third-quarter profits have tumbled 77 percent as it struggles with slowing economies and weak personal computer sales, prompting it to forecast sluggish sales in the fourth quarter.
Intel said that net income before acquisition-related costs fell to $655 million, or 10 cents a share, from $2.89 billion, or 41 cents, a year ago, before 5 cents a share in acquisition-related costs. Sales fell 25 percent to $6.55 billion from $8.73 billion.
The company had been forecast to report a per-share profit, excluding the costs, of 10 cents a share, within a range of 8 cents to 11 cents, according to Thomson Financial/First Call. Sales were forecast on average at $6.38 billion.
Intel, which has been buffeted this year by weak demand and competitive pressure from rival Advanced Micro Devices, said that it expects fourth-quarter sales of $6.2 billion to $6.8 billion, the same range it has given for the past two quarters. Analysts, on average, had forecast fourth-quarter sales of $6.8 billion, suggesting those estimates will need to come down in light of Intel's guidance.
"The good news is that Intel basically made the numbers everyone was expecting, so no disaster there," said analyst Mr Drew Peck at SG Cowen. "The bad news is that the guidance for the fourth quarter suggests that things are still deteriorating," he added.