Intel to cut 3000 after Q1 profit slump

Intel to cut 3000 after Q1 profit slump

Intel last week reported disappointing results for its first fiscal quarter, prompting the chip maker to announce staff reductions of up to 3000 employees.

Intel's net income in the first quarter, ended March 28, 1998, tumbled 36 per cent from $US2 billion in the same period a year ago, to $US1.3 billion, the company said.

Revenues were also down. Sales for the quarter totalled $US6 billion -- down 7 per cent from the $US6.4 billion reported this time last year, Intel said.

Revenues were down sequentially in the Americas, Japan and Europe, but were up slightly in the Asia-Pacific region, Intel said.

The chip maker attributed the shortfall to a weaker than usual demand for its processors by PC manufacturers.

"This was a disappointing quarter," said Andy Grove, Intel's chairman and chief executive officer. "The PC industry seems to have gotten ahead of itself, building more product than end customers purchased."

Intel apparently does not expect matters to improve before the second half of the year. The company expects revenues for the second quarter to be slightly down on the $US6 billion figure, while sequential revenue growth is unlikely to resume until the second half of 1998, Intel

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