Hard Drive Shortages Knock $1B USD Off Intel's Bottom Line
December 13, 2011 10:45 AM
comment(s) - last by
Intel will likely receive boost in opposite direction once shortage ceases and OEMs rebuild their inventories
Globally, personal computer sales and market demand continues to rise, posting their
fourth consecutive quarter of growth
. You'd think Intel Corp. (
), the world's largest maker of personal computer central processing units, would be celebrating. Instead its financial staff are reporting some unpleasant news.
yesterday that it was dropping its outlook for fourth-quarter revenue from $14.7B±$500M USD to $13.7B±$300M. GAAP and non-GAAP gross margins also dropped half a percentage point. The cuts were due to shrinking microprocessor sales.
It turns out that the
recent flooding which ravaged Vietnam
, producers of one quarter of the world's hard drives, is still sending shockwaves through the personal computing market. Hard drive shortages have hit the OEMs hard. As they can't build computers without hard drives, they've turned to pushing much of their backup inventories onto the market.
Meanwhile, the OEMs have cut their CPU orders from Intel to lower levels. Sales won't be restored until the hard drive supply picks up again and the OEMs begin to rebuild their inventories.
The good news is that Intel could enjoy a very strong H1 2012, the exepcted timeframe where the hard drive market will return to normalcy. OEMs will be trying to build up their stock, while meeting the growing demand at the same time, and that adds up to a lot of component purchases.
In that sense, this revenue drop looks be more of a deferment that a true loss of business. That said, it is still a painful one for Intel's investors. The company's stock fell 1 a quarter percent following the news, which aired lated yesterday.
This article is over a month old, voting and posting comments is disabled
Don't forget about the accounting tricks
12/13/2011 1:41:30 PM
I wouldn't blame all the downturn on the shortage. Some of it may be that Intel is taking some accounting losses while it has an excuse for them. The stock price is already down so why not take some extra losses on your balance sheet this month while everyone assumes you are going to be down this quarter due to a situation out of your control.
"If you mod me down, I will become more insightful than you can possibly imagine." -- Slashdot
Thailand Floods Cause Storage Shortages
October 24, 2011, 7:30 AM
Analysts: Apple Now Has More Than 10 Percent of the U.S. PC Market
July 14, 2011, 1:52 PM
Quick Note: QNAP Announces $129 QGenie 7-in-1 NAS for Mobile Users
July 14, 2014, 9:32 AM
Apple Launches 21.5” iMac with 1.4GHz Core i5 Processor Priced at $1,099
June 18, 2014, 8:07 AM
Lowe's "Holoroom" Brings Holodeck, Home Improvement Dreams Closer to Reality
June 13, 2014, 9:06 AM
Intel to Broaden Market for Fanless Tablets, Ultrabooks with 14nm Intel Core M
June 3, 2014, 10:42 AM
ZOTAC Announces Four New Silent ZBOX Mini-PCs
June 2, 2014, 9:21 AM
ZOTAC Announces Funky ZBOX Sphere OI520 Series
May 22, 2014, 8:20 PM
Most Popular Articles
Facebook Will Force Android, iOS Users to Use Messenger App This Week
July 29, 2014, 11:26 AM
Sony's Xperia Z3 Gets Detailed in Leaked Photos
July 25, 2014, 2:30 PM
Ford's Extensive Use of Aluminum in '15 F-150 Results in $395 Increase for Base Models
July 28, 2014, 3:02 PM
Report: Apple to Launch 12" Retina MacBook Air, 4K Desktop Product Later this Year
July 24, 2014, 4:33 AM
Pentagon's Priciest Project, F-35, Misses International Debut
July 25, 2014, 10:18 AM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information