NOVEMBER 12, 2010, 2:57 P.M. ET.

Intel Raises Quarterly Dividend

By ROGER CHENG

Chip maker Intel Corp.'s board approved a 14% hike in its quarterly stock dividend, highlighting its stability in a shaky technology spending environment.

The higher payout underscores the Santa Clara, Calif., semiconductor giant's strong cash flow and confidence despite questions about the broader state of technology. The move comes ahead of Intel's planned $7.7 billion all-cash acquisition of security-software maker McAfee Inc.

The company already offers the largest payout among the major technology companies, and the proposed first quarter increase will widen its lead. It is among a series of companies raising their dividends and buying back stock as the perceived need to conserve cash has declined.

Intel's quarterly dividend will rise by 2.25 cents to 18 cents a share at an added cost of about $128 million a quarter. The company has paid out $2.6 billion in dividends through the first three quarters of the year. The company is sitting on a stockpile of roughly $15 billion in cash and short-term investments.

The hike also runs counter to the comments provided by Cisco Systems Inc., which rattled the stock market late Wednesday when it offered up a surprisingly weak forecast for the current quarter.

Intel itself sent a shudder to the market in August when it cut back its third-quarter forecast because of weakness in the consumer market. But the company was far more upbeat last month when it reported results.

"Intel remains on track to have our best year ever," President and Chief Executive Paul Otellini said in a statement Friday.

Shares of Intel recently rose 1.4% to $21.51.

Write to Roger Cheng at roger.cheng@dowjones.com

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