Intel's shares jumped more than 6% the day after the chip maker reported first quarter sales that beat Wall Street expectations. Many analysts were surprised by how well its core microprocessor business had held up, an Associated Press report said.
Intel also forecast upbeat profit margin predictions for 2008, which helped boost the stock by signalling that the company expects to prosper despite falling prices for memory chips and fears of a slowdown in technology spending.
Intel's shares jumped US$1.29 (€0.81), or 6.2%, in morning trading yesterday.
The technology bellwether reported lower first quarter profits, but that matched analysts' subdued expectations, the report said. Analysts had lowered their estimates of Intel's profits last month after it warned that plunging prices for NAND flash, a type of memory chip widely used in consumer electronics, hit the company harder than expected. Intel had only recently entered that market.
Intel's net profit for the three months ended March 29 was €903 million, which is 12% lower than a year earlier, when Intel earned €1.02 billion (US$1.64 billion). But it was in line with the average estimate of analysts polled by Thomson Financial.
Intel's €6.6 billion in sales (US$9.67 billion) was a 9% improvement over last year, and came in slightly higher than Wall Street's estimate of €6.04 billion (US$9.63 billion).