Intel Corp. said Thursday that its fourth-quarter profit ballooned as a strong rebound in the personal computer market overcame a hefty payment Intel made to its biggest rival.
Intel also said that revenue and profit in the current quarter could be better than what analysts had been expecting. Computer shipments grew more sharply than expected in the fourth quarter after the recession led to a brutal year for the industry.
With Intel supplying the vast majority of PC microprocessors, the company generated net income of $2.3 billion, or 40 cents per share. That was more than nine times as much as it earned in the year-ago quarter, when profit totaled $234 million, or 4 cents per share.
Sales climbed 29 percent to $10.6 billion. Intel pegged the increase to brisker PC chip sales. It also said average selling prices for chips destined for server computers were higher than a year ago.
Analysts expected a profit of 30 cents per share and $10.2 billion in revenue, according to Thomson Reuters.
Intel's gross profit margin was 64.7 percent of revenue -- its best ever, the company said. A higher gross margin number means Intel was able to turn more revenue into profit.
Intel is the first major technology company to report its results for the fourth quarter. The company is seen as a barometer for the PC market and technology spending in general.
Intel said that in the current quarter, it expects revenue from $9.3 billion to $10.1 billion, and a gross profit margin of 59 percent to 63 percent. Analysts had been predicting first-quarter revenue of $9.3 billion and a gross margin of 59 percent.
Last quarter, Intel paid $1.25 billion to settle antitrust charges brought by Silicon Valley rival Advanced Micro Devices Inc., the world's No. 2 microprocessor maker. That cut 22 cents from Intel's bottom line.
ASSOCIATED PRESS
