Chip giant Intel is struggling with a slump in sales and profits

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Intel logo: Demand plummeted

Photo: Dado Ruvic / REUTERS

Chip giant Intel has clearly felt the fall in demand for personal computers.

The data center business also fell short of expectations.

In the two most important pillars of the group, sales fell by more than 30 percent in the past quarter, and operating profit collapsed by more than 80 percent.

Intel boss Pat Gelsinger referred to the weak economy and did not see any improvement in prospect for the current quarter.

The stock fell nearly 10 percent in after-hours trading on Thursday.

Intel's quarterly figures were below analysts' estimates and their forecast for the current quarter also missed expectations.

The group expects revenues of 10.5 to 11.5 billion dollars, while analysts had expected almost 14 billion.

PC market saturated

In the PC chip business, Intel's sales fell by almost 36 percent to $6.6 billion.

According to calculations by the analysis company Gartner, sales of personal computers collapsed by a good 28 percent in the past quarter.

That was the sharpest decline since Gartner began tracking the market in the mid-1990s.

In the first few years of the corona pandemic, the sale of computers - especially notebooks - had grown explosively.

In the meantime, demand has fallen sharply.

Operating income from Intel's PC division fell to just $699 million from around $3.8 billion a year earlier.

The group cites investments in future chips and production processes as one of the reasons.

In data center technology, revenues fell by around a third to $4.3 million.

Intel is fighting against attacking rivals like AMD in the lucrative market.

In this division, too, there was a slump in earnings with 371 million dollars instead of 2.3 billion dollars a year ago.

Group revenue fell 32 percent year over year to $14 billion last quarter.

The bottom line was a loss of $664 million after a profit of $4.6 billion a year earlier, as Intel announced after the US stock market closed.

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