Intel announces a billion dollar cut in 2011 fourth quarter

Intel Corporation has announced a predicted cut of $1 Billion in revenues due to reduced demand of their semiconductors.

Intel is still the biggest suppliers of semiconductors (microprocessors) to most of the PCs and Mac machines in the world. However, the cutback in their products has nothing to do with quality or as some experts are alleging there is some internal gruelling
matter unresolved at Intel. The Silicon Valley giants however, have evaded such rumours.

The PC food chain does not have a broken link at Intel though. It is the Thailand’s September floods that have affected it. Western Digital, the biggest storage hard drive manufacturers announced in October that they will be cutting their HDD production
in the December quarter due to the natural disaster.

Due to this reason, companies like Apple, Dell and HP are not getting their supply of hard drives and they are cutting their production to half. For a layman, a computer is worthless without a hard disk in it. This automatically inflicts damage on the demand
of microprocessors.

However, tech gurus, especially at Wall Street as Intel mentioned, are worried about the stock position of the company and dread that Intel will hurl into 2012 with the same performance.

Intel’s stock took a dip of $1.01 or 4 percent to a $24 share in the stock market following Intel’s announcement. Although the price loss is merely noticeable, experts are of the opinion that the plunge will continue with the lack of demand in Intel’s merchandize
until they find a viable solution to the problem at hand.

Companies like Apple, Dell and HP are considering incorporating solid-state hard drives into their computers as a temporary solution—in special offers to the customers, of course—in order to sustain customers’ demand.

In addition to Western Digital, manufacturers of hard drive components like the spindles have also been affected by the monsoon floods. The normal production is expected to meet its target at the end of 2012 first quarter.

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Posted by Usman Khalid on Dec 13 2011. Filed under Sci-Tech, USA. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry