Intel inside forecasts

NEWS The chipmaker said it would not be reducing its $7.5bn capital expenditure budget. Intel shares subsequently rose 10 per cent in after hours trading to $28.64. Revenue for the world's largest chipmaker was $6.7bn for its first fiscal quarter 2001, down 23 per cent on the final quarter 2001 and 16 per cent on the comparable period last year. Profit for the quarter was $1.1bn, down 64 per cent from the first quarter of 2000 and 58 per cent from final quarter 2000. Intel said that its microprocessor business 'appears to have stabilised', but that communications chip sales were 'soft' and server chip sales were lower than expected. The shares had been hit yesterday, before the release of the results, by a report by bankers Morgan Stanley that Intel's margins would be weaker this year because it is slashing the price of its Pentium 4.