Tech Holiday Gets Bleak: Intel (INTC) Warns On Q4 (AAPL)(DELL)(HPQ)(RIMM)(BBY)
November 12, 2008 by Douglas A. McIntyre
It is rare when a company warns about its Q4 numbers on November 12. That made Intel’s (INTC) announcement about the final quarter of the year all the more shocking.
Intel said it now expects fourth quarter revenue to be $9 billion, plus or minus $300 million, lower than the previous expectation of between $10.1 billion and $10.9 billion. Revenue is being affected by significantly weaker-than-expected demand in all geographies and market segments. In addition, the PC supply chain is aggressively reducing component inventories.
The firm’s expectation for fourth quarter gross margin moved to 55% plus or minus a couple of points, lower than the previous expectation of 59% plus or minus a couple of points, primarily due to lower revenue and other charges associated with the weaker-than-expected demand environment.
Taken together with today’s profit warning from Best Buy (BBY) and it is now certain that consumer electronics and PC sales forecasts for the holidays have been crushed.
Intel’s shares fell 7% after to close to $12.55 after moving down 3% during the regular session. The stock has a 52-week low of $13.51 and a period high of $27.99. Apple (AAPL), HP (HPQ), RIM (RIMM), Dell (DELL), and AMD (AMD) are likely to be caught in the vortex tomorrow.
Douglas A. McIntyre
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