Intel Q1 Revenue Down; Atom Sales Fall

Intel report slumping Q1 numbers. Yep, we’re still in a recession.

It’s grim times in the economy, but Intel still managed to beat expectations with news that things aren't as bad as initially anticipated. The company reported earnings and revenue down 55 percent and 26 percent, respectively. Gross margin also fell from 53 percent to 46 percent.

The slump in the numbers should come as no surprise given the sagging economy, which has hit the computer industry as a whole since late 2008. According to Mercury Research, shipments of x86 CPUs for desktops, servers and notebooks declined 18 percent between the third of fourth quarter of 2008. Overall, the x86 market was down 8.8 percent as compared to fourth quarter 2007.

The Intel Atom processor has always been a bright spot for the company, thanks to the growing netbook and nettop market, which appeal to the price-sensitive buyer. Sales of the Atom accounted for $219 million for the quarter, which represents a 27 percent decline from the prior quarter.

Intel is optimistic for brighter days ahead, as company CEO Paul Otellini said during a conference call, "We are seeing signs that the bottom of the PC market segment has been reached. I believe the worst is now behind us."

  • I'm sure Intel has multi-millions somewhere stocked. We won't be seeing that company going down,even if the recession takes another year or two.
  • solymnar
    You're probably right ProDig.

    Intel hasn't been known to mismanage funds and has been running in the black for a loooong time now. They also don't hesitate to down size when its beneficial seeming to prefer shrinking instead of risking having too much red ink at the bottom line.

    In the position they are now...they can afford to be careful.
  • hellwig
    Don't forget the millions Intel is spending trying to bully AMD and NVIDIA into paying more for licensing rights. That's going to bite them in the end too (especially when AMD and NVIDIA don't back-down and just pay Intel what it wants).
  • avericia
    "We are seeing signs that the bottom of the PC market segment has been reached."

    I have to agree, I built a box last November and i saw a lot of parts actually go up slightly a few months after and other parts now are only 10-15% bellow what i paid for them which is less depreciation then you normally see in a 7 month period on PC parts.
  • danimal_the_animal
    atom sales are weak because people want the DUAL CORE version in their netbook instead of this CRAP single core.....and are probably holding out in hopes of an ion based netbook.

    i bought my daughter an acer aspire IS a cool laptop, but why not add a dual core instead of a single?

    and why not an ion chipset and a 720p screen?

    1024x600 is really lame.
  • danimal_the_animal
    also it would be COOL to have HDMI output on a netbook.

    they would be killer if this happened.
  • apache_lives
    everyone who wanted one bought one? so lower sales now?
  • yoda8232
    Lower your prices and you'll do better, much better.
    Easy as that.
  • Misinformation abound in these comments. Atom sales are down from Q4 because many OEM built large inventories in Q4 due to the popularity of netbooks. Intel is forecasting a roughly 2X increase in sales for 2009 compared to 2008...I guess that's 'slowing' for the haters?

    AMD does not pay Intel a SINGLE PENNY for licensing! They are not trying to bully more fees out of them, because they don't pay any! They have a royalty free cross-license. What they are trying to do is ensure the spinoff, ummm 'subsidiary', of Global foundries meets the contractual agreement and that the license isn't transferred to them (as AMD can't do that without INTEL's OK).

    Intel has ~10Bil in cash on hand, even with handing out just under 1Bil/year in dividends.
  • outacontrolpimp
    justthefaxxMisinformation abound in these comments.
    Thank you, I knew this same information as you. AMD made a new company to make processors, which wasnt ok. AMD CAN make them tho, just not that Global watever its called company.