Intel "stuffed the channel" causing CPU sales collapse

SEMI FINANCIAL ANALYSTS at Handelsbanken Capital said it is expecting another profit warning from Intel because of poor chip sales.

Handelsbanken claimed Intel "stuffed the channels with chips in February and March, the floor fell out in April, and sales dropped 52% year on year".

The firm said in a note to its clients that Intel processor prices fell 40 per cent year on year in April, with volumes dropping by 21 per cent. That leads Handelsbanken to the view that Intel will deliver another profit warning, guiding Q2 sales to $7.9 billion, versus a consensus figure of $8.4 billion.

Average selling prices fell from $109 in March to $52 in April and were down 40 per cent year on year, said the firm. That had an effect on computer and peripheral logic sales.

The note continued: "Intel has obviously given up on making any money on its current generation of processors and has started a price war with AMD." The Intel (tick: INTC) share price closed at $18.04 on NASDAQ yesterday, a rise of two cents on the day. µ

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