Intel sees more hard times in 2009

By Jordan Robertson Jan. 16, 2009

Intel Corp. appears to be playing it safe with an ugly first-quarter forecast. The chip maker reported Thursday that profit plunged 90 percent and sales slipped 23 percent during the last three months of the year, matching analysts' subdued estimates. Wall Street was braced for the bad news: Intel had lowered its fourth-quarter guidance twice, including once just last week, warning that weaker-than-expected PC demand was hammering down demand for its microprocessors. So what about 2009? Intel said it doesn't know when demand will pick back up, so the Santa Clara-based company set the bar low and offered first-quarter guidance at the low end of what analysts were expecting. Intel said it 2009 sales will likely be around $7 billion, which translates to a decline of more than 25 percent from the first quarter of 2008. Gross profit margin should also sink sharply, falling from more than 50 percent of sales to the low-40 percent range, it said.

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