Intel reported an 18 per cent rise in quarterly revenue and a near doubling of profit, but its stock fell about 5 per cent after it cut its profit margin forecasts and said inventories rose.
The world's largest chip maker and technology bellwether said inventories grew 15 per cent in the past three months, which one analyst said could portend an asset write-down or weaker profit margins. Intel said it would slow the growth of production output as it sells off unsold products.
Intel is among the first of the major technology companies to report earnings for the second quarter, said profit rose to $1.76 billion for the second quarter ended June 26th from $896 million a year earlier.
Revenue, boosted by stronger demand for its cellular phone memory chips, rose to $8.05 billion from $6.82 billion in the same period last year. Results were in line with Wall Street estimates.
Intel also lowered its forecast for gross profit margin for the year to around 60 per cent from 62 per cent, citing faster growth of less-profitable products and a slight drop in prices for microprocessors.