Intel Profit Climbs on Stronger Sales

By NATHAN BECKER

Intel Corp.'s fourth-quarter earnings jumped 48%, topping analysts' views, as the chip-making giant's sales rose sharply and margins gained in part on a year-earlier $1.25 billion settlement charge.

The company also forecast current-quarter revenue of between $11.1 billion and $11.9 billion. Analysts surveyed by Thomson Reuters expected $10.74 billion in revenue.

Shares rose 1.4% to $21.59 after hours. As of 4 p.m. on Thursday, the stock had risen 1.6% in the past year.

Intel makes the chips that run about 80% of the world's computers. It has benefited from robust corporate spending on technology, which has helped allay fears of a slowdown in computer demand. Intel is viewed as a bellwether because its dominant position in the microprocessor market makes it a leading indicator for computer sales.

Industry research firms Gartner and IDC on Wednesday said PC sales during the fourth quarter were even weaker than had been feared, partially due to a ramp-up in sales of tablets, an area Intel has been slow to enter.

For its fourth quarter ended Dec. 25, Intel reported a profit of $3.39 billion, or 59 cents a share, up from $2.28 billion, or 40 cents, a year earlier. Excluding the year-ago charge related to a settlement with Advanced Micro Devices Inc. and other items, earnings last year were 55 cents a share.

Revenue jumped 8.4% to $11.46 billion.

Analysts polled by Thomson Reuters had most recently forecast earnings of 53 cents a share on $11.37 billion in revenue.

Gross margin, or profit after manufacturing costs, rose to 67.5% of sales from 64.7% a year ago.

Write to Nathan Becker at nathan.becker@dowjones.com

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