Intel reports strong third-quarter results

"Intel's strong third-quarter results underscore that computing is essential to people's lives, proving the importance of technology innovation in leading an economic recovery," said Paul Otellini, Intel president and CEO.

"This momentum in the current economic climate, plus our product leadership, gives us confidence about our business prospects going forward. As we look ahead, Intel's game-changing 32nm process technology will usher in another wave of innovation from new, powerful Intel Xeon server platforms to high-performance Intel Core processors to low-power Intel Atom processors," he added.

Key Financial Information:

• Record microprocessor and chipset units.
• Mobility Group revenue up 19%, Digital Enterprise Group revenue up 14%, and Intel Atom microprocessor and chipset revenue up 15% to $415m, all sequentially.
• Gross margin was 57.6%, higher than the company's expectation.
• The average selling price (ASP) for microprocessors was slightly down sequentially.
• Inventories were down $315m sequentially.
• Spending (R&D plus MG&A) was $2.75b, consistent with the company's expectation.
• Restructuring and asset impairment charges were $63m, higher than the company's expectation.
• The net loss from equity investments and interest and other was $47m, better than the company's expectation.
• The effective tax rate was 27%, versus the company's expectation of 23%.

Business Outlook:

Intel's Business Outlook does not include the potential impact of any mergers, acquisitions, divestitures or other business combinations that may be completed after October 12.

Q4 2009:

• Revenue: $10.1bn, plus or minus $400m.
• Gross margin percentage: 62%, plus or minus 3 percentage points.
• Spending (R&D plus MG&A): Approximately $2.9bn.
• Restructuring and asset impairment charges: Approximately $40m.
• Amortization of acquisition-related intangibles and costs: Approximately $20m.
• Impact of equity investments and interest and other: Approximately zero.
• Tax rate: Approximately 26%.
• Depreciation: Approximately $1.2bn.
• Full Year Capital spending: Expected to be $4.5bn plus or minus $100m, down from the prior expectation of $4.7bn plus or minus $200m.

Status of Business Outlook:

During the quarter, Intel's corporate representatives may reiterate the Business Outlook during private meetings with investors, investment analysts, the media and others.

From the close of business on Nov. 25 until publication of the company's fourth-quarter earnings release, Intel will observe a "Quiet Period" during which the Business Outlook disclosed in the company's news releases and filings with the SEC should be considered as historical, speaking as of prior to the Quiet Period only and not subject to an update by the company.

Risk Factors:

The above statements and any others in this document that refer to plans and expectations for the fourth quarter, the year and the future are forward-looking statements that involve a number of risks and uncertainties.

Many factors could affect Intel's actual results, and variances from Intel's current expectations regarding such factors could cause actual results to differ materially from those expressed in these forward-looking statements.

Intel presently considers the following to be the important factors that could cause actual results to differ materially from the corporation's expectations.