Recession had hit many companies severely. It seemed that it would take a couple of years for all these companies to bounce back from their huge losses. Fortunately one of the recession hit companies has risen from the ashes of its losses and has started earning profits; the company in question is world’s largest chipmaker- Intel. Intel has earned USD 2.9 billion for the quarter ending on June 26.

It’s end of the tunnel

Intel posted a massive loss of USD 398 million in the June quarter of 2009.Adding to the woes of the company they paid USD 1.45 billion as a charge to the European Antitrust as a fine. It lost approximately 7 cents per share because of this loss.

The company has successfully bounced back from its lows and has posted a profit of USD 2.9 billion for the same quarter in 2010. The company has managed to add 51 cents per share to its share price, in comparison to the analyst expectations of 43 cents per share. This is apparently the highest amount of profit the company has earned in its 42 year long history.

Financial details of the company

The company has earned revenue of USD 10.8 billion viz 34% higher, year on year basis. Surge in demand from corporate customers for Intel’s microprocessors helped the company to post such a humongous profit.

Brief details of the financial statements of the company for the second quarter are given below (the comparisons are made on quarter-over-quarter basis);

  • Gross margin figures of any company depict its profitability. Gross margin of Intel was 67%. This is 3% higher than the expected range of 62%-66%, by the company.
  • The Data Centre Group of the company recorded revenue of 13% higher to the previous year’s quarter. This was the result of higher microprocessor revenue figures.
  • Mobile microprocessor revenue lead to revenue hike of 2% in the PC Client Group of the company.
  • The Atom Processor and chipset revenue grew by 16% to USD 413 million.
  • The Research and Development expenses along with the Mergers and Acquisitions expenses were USD3.25 billion, which is more than the expected spending of USD3.1 billion.
  • The ASP (Average Selling Price) for the microprocessors grew marginally.

The road ahead

Intel is now expecting to earn revenue of USD11.6 billion in its coming third quarter. The deviation expected is USD 400 million. The Gross margin expected is 67%, with a deviation of a couple of percentages.

For year ending 2010 the Gross margin of the company is expected to be around 66%, with a deviation of couple of points. This is higher in comparison to company’s previous forecast of 64%.