US chip giant Intel on Tuesday reported strong first quarter profits on higher sales revenue, with earnings per share up 13 cents, 30% year-over-year. Meanwhile, Goldman Sachs in a new report says tablet computers such as the iPad, will cannibalize about 35% of the PC market in 2011.
The firm said revenue was $12.9bn, operating income was $4.3bn, net income was $3.3bn, and EPS (earnings per share) was 59 cents.
The company generated approximately $4.0bn in cash from operations, paid cash dividends of $994m, and used $4.0bn to repurchase 189m shares of common stock.
The first quarter “was a very strong quarter and significantly better than we expected,” Stacy J. Smith, Intel’s chief financial officer, said in an interview on Tuesday.
The company gained from sales of
chips used in server systems and other hardware for computer rooms, and revenue
increased 32% in that business.
“The first-quarter revenue was an all-time record for Intel fueled by double digit annual revenue growth in every major product segment and across all geographies,” said Paul Otellini, Intel president and CEO. “These outstanding results, combined with our guidance for the second quarter, position us to achieve greater than 20% annual revenue growth.”
Also on Tuesday, Goldman Sachs in a
research report termed tablet computers such as the iPad "one of the most
disruptive forces in computing" in nearly 30 years. Analysts at the
investment bank said tablets are eating into the traditional PC market and will
be a challenge for the PC industry currently dominated by Microsoft and Intel,
in the earnings stakes.
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