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Intel celebrates best year in its history

Chip giant records record profit gain

Intel has announced it finished fiscal 2010 with profit and revenue gains in the fourth quarter, and predicted a strong fiscal year 2011.

The company reported net income of $3.4 billion for the quarter ended on Dec. 25, up by 48 percent compared to the same quarter last year. Earnings per share were $0.59, beating the consensus estimate of $0.53 from analysts polled by Thomson Reuters.

"2010 was the best year in Intel's history. We believe that 2011 will be even better," said Paul Otellini, Intel's CEO, in a statement.

Intel reported revenue of $11.5 billion, an increase of 8 percent compared to the same quarter last year. Analysts had expected revenue to be $11.37 billion.

Intel's Data Center Group recorded $2.5 billion in revenue for the quarter, compared to $2 billion in revenue during last year's fourth quarter. The Data Center Group offers products for servers, storage and workstations.

"The enterprise market segment was strong, specifically the server segment, as a result of strength in both the corporate and data
center segments," said Stacy Smith, Intel's chief financial officer, in a commentary published on Intel's website (PDF).

Revenue for the PC Client Group was $8.03 billion, growing from $7.76 billion in last year's fourth quarter.

For the whole year, Intel reported revenue of $43 billion, up 24 percent compared to the last fiscal year. Intel is hoping for a strong fiscal 2011.

For the first quarter of 2011, Intel is expecting revenue to be around $11.5 billion, plus or minus $400 million.

The past two weeks have been busy for Intel. The company last week announced the launch of its next generation of Core processors based on the Sandy Bridge architecture, which include a CPU and graphics processor on a single chip.

Intel and Nvidia also ended a long legal battle by signing a cross-licensing agreement, under which Intel has agreed to pay Nvidia $1.5 billion. Intel will pay $300 million to Nvidia next week and then make annual payments through January 2016.

While Intel remains dominant in the PC space, it is now trying to make its way into the smartphone and tablet space, which is dominated by ARM. Tablets based on Intel's Oak Trail chips are expected to start shipping by the end of this quarter.

Intel has also said that it will make smartphone-related announcements at the Mobile World Congress, which will be held next month in Barcelona. The company is developing a low-power chip for smartphones code-named Medfield, which is based on the Atom core.


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