PC sales slow ahead of expected Intel price cut
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(InfoWorld) - Global PC sales have slowed a tad over the past few weeks as the market waits for Intel to announce new price reductions, market researchers said. The world's largest chip maker is widely expected to publish a new price list on July 22 that shows lower prices for microprocessors aimed at the desktop PC market. The company regularly updates its pricing, but doesn't disclose when or how much prices will change, an Intel spokesman said Thursday. Still, PC makers in Taiwan, as well as analysts and market researchers said they receive word of price changes ahead of time, and that the expected Intel price reductions were the reason Advanced Micro DevicesÂ announced microprocessor price cuts earlier this month. AMD slashed prices on its top-of-the-line desktop PC microprocessors by a few hundred dollars, and now offers six AMD Athlon dual-core microprocessors for below $100 each. The AMD move was aimed atÂ pre-empting Intel's anticipated July reductions, according to a report by investment banking firm Goldman Sachs Group. The expected price cuts are a continuation of Intel's battle for market share against rival AMD. It's a fight that has been great for users, particularly in desktop PCs. Microprocessors are among the most expensive parts in a PC, so price cuts on the chips usually lead to better deals for users, either on lower PC prices or more add-ons, such as better DVD drives, more memory, or larger hard disks. The market share battles have also prompted both Intel and AMD to boost technology, resulting in more bang for a user's buck. The price war hasn't been so good for the companies. Intel's stock fell 4.8 percent to end at $25.06 per share on the NASDAQ stock exchange Wednesday, a day afterÂ the company reportedÂ a lower than expected profit margin for the second quarter. Analysts blamed the price war. The fight with Intel has caused AMD to report weaker earnings in recent quarters, and analysts are not optimistic about its second quarter earnings, which it will report later Thursday in the U.S. "We believe the worse than expected gross margin, higher than expected R&D [research and development] spending and low quality earnings leverage (tax rate changes, sold depreciation, etc.) will cast a shadow over [Intel's] stock," wrote Michael Masdea, chip analyst at Credit Suisse Securities (USA), in a recent report. He predicted that Intel gained market share on AMD in the second quarter, based onÂ its earnings report. Market researchers were not able to say exactly how muchÂ the PC marketÂ has slowed over the past few weeks, but indicated that the weaker sales have shown up in various places in the PC component supply chain. Slower trading in the DRAM (dynamic RAM) market, for example, caused prices to drop last week, according to DRAMeXchange Technology, which runs an online DRAM trading site. The company blamed the anticipated Intel price adjustments for the declines. Â
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Intel Corp.&#39;s (INTC.O: Quote, Profile, Research) upcoming mid-quarter report will be closely watched for signs of weak back-to-school computer sales, though recent
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Taiwan&#39;s Asustek Computer complained on Tuesday of a shortage of Intel central processing units (CPUs) for laptop PCs, but said it didn&#39;t expect the problem to affect its sales.&quot;The biggest shortage in notebook components is in CPUs, Intel CPUs. Intel isn&#39;t meeting demand,&quot; said Jerry Shen, president of Asustek, answering questions at an investors conference in Beitou, Taiwan.The statement highlights persistent problems laptop PC makers have faced this year in trying to procure certain parts. Strong demand for mobile computers has caused&#160;a shortage&#160;of small LCD (liquid crystal display) screens and small hard disc drives (HDD), laptop makers have complained. Therecall of around 10 million laptop batteries&#160;containing cells manufactured by Sony has also kept these vital parts in short supply since last year.Intel could not immediately be reached for comment.Back-to-school sales in September, and the run-up to the end-of-year holiday season are hot times for people to buy new laptop PCs, and hype around Microsoft&#39;s Windows Vista and&#160;Intel&#39;s Santa Rosa laptop chips&#160;has given an added spurt to demand this year. Laptop PC sales are expected to hit record highs, and some companies believe the market will grow by around 30 percent next year.Supplies of certain laptop parts could become more plentiful once the peak season ends and demand slows down.Meantime, laptop makers have had to keep up with suppliers by maintaining relationships and building inventory when they can.&quot;Our relationship with Intel is good so we don&#39;t have a big problem, but if it wasn&#39;t so good, our troubles might be worse,&quot; said Shen, of the CPU issue.Asustek forecasts it will ship between 4.2 million and 4.4 million of its own-brand laptops this year, not including its popular new Eee PC. The company has targeted shipments of up to 400,000&#160;Eee PCs&#160;this year.&#160;
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Investor's Business Daily - Chip giant Intel  (NasdaqGS:INTC - News) fell short in the fourth quarter and issued a tepid outlook, heightening concerns about the sluggish economy's impact on tech demand.
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Intel Corp. , the largest maker of computer processors, posted a rise in second-quarter earnings on Tuesday, but missed its gross profit margin goal and its shares fell nearly 5 percent.
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NEW YORK - Intel certainly surprised many semiconductor industry watchers today with its improving sales forecasts for the current quarter, but not everyone is convinced that all is as rosy as it seems at the world&#39;s biggest chipmaker.
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Microprocessor giant Intel slightly exceeded the lowered third-quarter expectations it had set for itself last month. But growth was inhibited by inventory adjustments at some of major customers and lower than expected PC demand.
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Computer processor maker Advanced  Micro Devices Inc.  on Thursday warned that  second-quarter sales would miss expectations as price cuts by  rival Intel Corp.  on chips to power desktop PCs  hampered demand.
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A disappointing holiday sales forecast from Wal-Mart is dragging on blue chips, while Apple Computer is a bright light on Wall Street.
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By Laurie J. Flynn  Advanced Micro Devices has said it is unlikely that the company will meet its target of $1.6 billion to $1.7 billion in revenue for the first quarter, providing evidence that the chip maker's price war with Intel was continuing to take its toll.
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Green Christmas. Intel (nasdaq: INTC - news - people ) on Thursday pumped up the range of its fourth-quarter sales forecast. The Pentium chip maker cited muscular global holiday demand for its microprocessors.
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NEW YORK/SAN FRANCISCO  - Advanced Micro Devices Inc  has delayed shipments of a key, high-end microprocessor until the first quarter of next year and does not expect to break even until the second quarter, the chipmaker said on Thursday.
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STOCKS in the United States fell - led by technology shares - after the world&#39;s biggest semiconductor maker Intel cut its revenue forecast because of slowing demand for personal computers and mobile phones.
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Intel Corp.&#39;s upcoming mid-quarter report will be closely watched for signs of weak back-to-school computer sales, though recent market share gains in memory chips could help offset any softness in computer microprocessor demand.
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Intel Corp., the world's largest chip maker, posted a 51 percent jump in its fourth-quarter profit Tuesday, but sales fell slightly below expectations and the company's shares dropped sharply in after-hours trading.
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Intel Corp.  on Thursday cut its third-quarter revenue and profit margin forecast after demand for both its computer microprocessors and communications chips weakened beyond expectations. Its stock fell nearly 8 percent.
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Chipmaker reports record sales of server and notebook processors, but net income dips.