$8 billion in revenue offset by record $1.45 billion fine causes $398 million net loss

Intel Corporation is starting to see a recovery in the CPU market, as it disclosed its second quarter results showing revenue of $8 billion, up 12 percent from the first quarter. However, this is still lower than the $9.4 billion in revenue for the same time last year, before the recession came into force.

A particularly bright spot for the world's largest semiconductor firm was increased sales in the netbook and net-top category. Revenue from Atom CPUs and related chipsets was $362 million, up 65 percent from the last quarter.

Inventories were lower by $240 million, meaning that Intel can introduce new processors without fear of a massive stockpile of trailing edge CPUs.

“Intel’s second-quarter results reflect improving conditions in the PC market segment with our strongest first- to second-quarter growth since 1988 and a clear expectation for a seasonally stronger second half,” said Paul Otellini, Intel's President and CEO.
“Intel's strategy of investing in new technologies and innovative products, combined with ongoing focus on operating efficiencies, continues to yield benefits that are evident in our strengthening financial performance.”

The company would've had a net profit of $1 billion for the quarter, but the firm decided to absorb the entire $1.45 billion fine from the European Commission. This resulted in a net loss for the quarter of $398 million.

At the time the fine was levied in May, Intel stated that it would not affect Intel's operations and its planned 32nm transition to the Westmere family of products later this year. "Intel will continue to invest and innovate," stated Intel spokesperson Claudine Mangano.

The third quarter looks more promising, as the lucrative back-to-school season will boost Intel's revenues. Approximately 45 percent of the 800 million computers globally are three years old or older, suggesting a pent up demand to refresh those machines that will also coincide Microsoft's release of Windows 7 on October 22.

"And boy have we patented it!" -- Steve Jobs, Macworld 2007

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