Although the world’s largest chip maker Intel Corp. (NASDAQ: INTC) reported slightly lower-than-expected fiscal first-quarter earnings and revenue on Tuesday, investors’ faith in the Company remained intact as guidance on the second quarter matched with Wall Street expectations.
Shares having climbed as much as 3% in aftermarket hours, pared most of its gains latter, ending up 0.71% higher at $22.07.
Shares of Intel have been under immense pressure since last week when a market research firm, IDC, said that PC sales have tumbled 13.9% in the first quarter of 2013, a steepest quarterly decline ever recorded. As more and more users prefer tablets and smartphones, PC sales have been declining persistently since past two years.
Still, the Company reiterated its earlier guidance on 2013 revenue. The Company expects revenue would edge up by lower single digit percentage, which some analysts believe will be an uphill task, considering the challenging environment.
Speaking to analysts in earnings call on Tuesday, Chief Financial Officer Stacy Smith said that its forthcoming Haswell chip, along with new ultrathin laptops and an improving macroeconomic environment, would revitalize growth in coming quarters.
For the fiscal first quarter, Intel reported net income of $2.04 billion or 40 cents a share compared to a profit of $2.74 billion or 55 cents a share. Revenue during the quarter came at $12.58 billion down from $12.91 billion, in the year-earlier quarter. Analysts polled by Thomson Reuters were expecting earnings of 41 cents on revenue of $12.588 billion.
For the second quarter, the Company is expecting revenue of $12.9 billion plus or minus $500 million, which is consistent with analysts’ estimate of 8% decline or $12.854 billion.
“These numbers are not very solid, but the second-quarter guidance is better than feared. Conditions are probably not as bad as industry reports have suggested recently,” said Doug Freedman, an analyst at RBC Capital, according to CNBC.
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