Intel has reported US$6 billion in revenues for its second quarter, driven mostly by sales of Pentium MMX and Pentium II processors.
But due to seasonally slower sales during the quarter, Intel's revenues and earnings slumped compared to the first quarter of this year, dropping 7.6 percent and 17 percent respectively, company executives say. Officials blame the drop on weak European markets, inventory correction following a strong first quarter, and product transitions in the PC industry.
Net income in the second quarter, which ended June 28, totalled $1.6 billion, up 58% from last year's second quarter net income of $1.0 billion, says Andy Bryant, vice president and chief financial officer at Intel. That was a 17% drop from the first quarter of this year, however, when Intel posted net income of $2.0 billion.
Earnings per share rose 56% during this year's second quarter, to $0.92, up from $0.59 in the second quarter of 1996. But earnings per share dropped 16% compared to the first quarter of this year, when they were $1.10 per share.
The share and per-share amounts announced today have been adjusted to reflect a 2-for-1 stock distribution that was paid July 13, 1997.
Intel's second quarter revenues this year were $6 billion, up 29% from the $4.6 billion it reported during the same period last year. But this year's second quarter revenues were down 7.6% from the $6.4 billion in revenues posted in this year's first quarter.
Looking ahead, Bryant says, Intel expects third quarter revenues this year to be flat to slightly up from those in the second quarter.
Unit shipments of Intel's microprocessors, chipsets and motherboards were down in the second quarter of this year, compared to the first quarter, officials say. Pentium II processor motherboards showed higher unit shipments, however, the only exception to the trend.
Unit shipments of flash memory set a record during the quarter, while embedded processor and microcontroller units shipments were flat compared to the first quarter.
In Japan and the Americas region, Intel had sequentially higher revenues in the second quarter. The combination of seasonally lower demand and an inventory correction in Europe led to lower sequential revenue there, and revenue in Asia-Pacific region was also sequentially lower, executives say.