Intel sales and profits fall in third quarter

Computer chip maker Intel has reported falls in both sales and profits in the third quarter, saying the results “reflected a continuing, tough economic environment”.

The company reported a net profit of $2.97bn for the quarter ending 29 September, down 14% on the same period a year ago. Net sales fell 5.5% to $13.46bn.

Last month, Intel warned that lower demand for computers from businesses and individuals would hit its sales, according to the BBC.

"The world of computing is in the midst of a period of breakthrough innovation and creativity,” said Paul Otellini, Intel president and CEO.

“As we look to the fourth quarter, we're pleased with the continued progress in Ultrabooks and phones and excited about the range of Intel-based tablets coming to market,” he said.

Intel forecasts revenue between $13.1bn and $14.1bn in the fourth quarter. Third quarter revenue was reported at $13.5bn.

In the third quarter of this year, total global PC shipments fell 8.3% compared with the same period a year ago to 87.5 million, according to research firm Gartner.

In the next year, Gartner predicts tablet sales will increase 53%, but says the 2012 figure of 118,883 will more than treble by 2016.

Last week, rival chipmaker AMD announced it is expecting a 10% decline in sales in Q3 compared with Q2, ahead of the announcement of third quarter results on 18 October.

“The lower-than-anticipated preliminary revenue results is primarily due to weaker than expected demand across all product lines caused by the challenging, macro-economic environment,” AMD said.

This week it emerged that AMD plans to cut as many as 2,340 jobs – about 20% of its workforce.

Less than a year ago, in November 2011, AMD cut 10% of workforce to reduce costs.