Intel Q3 estimates reduced on soft demand for PCs; Buy Infineon's mobile unit
8/30/2010 04:49:00 PM
kenmouse
, Posted in
After a record setting Q2 for Intel the company is warning investors that earnings for Q3 will be below expectations. That is a marked turn around in only a few months for Intel. Intel reported recently that it expects the Q3 revenue to be $11 billion plus or minus $200 million.The estimates before were pegged at $11.2 to $12 billion. The reason cited by Intel for the change in estimates is a weaker than expected demand for computers in mature markets. Intel is now projecting gross margin for Q3 to be in the 66% range plus or minus a single point. Previously the gross margin was pegged at 67%.
Intel does point out that some of the lower volume is being offset by higher average selling prices thanks to higher demand from enterprise customers. All other expectations for Q3 remain as previously announced.
Intel gobbles up Infineon's mobile unit in $1.4 billion deal, looks to 'accelerate 4G LTE'
Infineon, the company behind the baseband chips inside your super-duper new phone, is about to cash out from the wireless industry courtesy of Intel's insatiable appetite. The Wireless Solutions Business (WLS), which accounted for nearly a third of Infineon's €3 billion ($3.83b) revenue last year, is being sold to the American chipmaker for a cool $1.4 billion. For its part, Intel is quick to reassure the world (and its antitrust authorities) that WLS will continue to operate as a standalone business and continue to support ARM-based devices. Chipzilla's perfectly innocent ploy is to harness Infineon's knowhow in future smartphone, tablet and laptop products, providing both the processing and wireless capabilities. Specifically mentioned in the news release is Intel's ambition to "accelerate 4G LTE" through this deal, while also not neglecting its ongoing efforts with WiMAX, with the overarching strategy being described as "a combined path." We should know more about where this path will take us when the acquisition is completed in the first quarter of next year.
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