Intel proclaims 'superb' 2011

Chipmaker saw "exceptional" earnings report for last year and says it will continue to invest in key growth areas such as ultrabooks, smartphones and tablets.
Written by Jamie Yap, Contributor

Intel has posted "exceptional" numbers in its 2011 earnings report that saw profit jump by 13 percent from last year, and it will continue to invest in key areas such as ultrabooks and Intel-powered smartphones and tablets.

The chipmaker released a statement on Thursday, revealing that its full-year 2011 earnings report saw US$12.9 billion in profit, representing a 13 percent increase from 2010. Revenue also rose to US$54 billion, or a spike of 24 percent, with the fourth quarter contributing US$13.9 billion, it added.

Intel had in December lowered its fourth-quarter revenue outlook from US$14.7 billion to US$13.7 billion due to a supply shortage of hard disk drives (HDDs) caused by the Thailand floods.

Commenting on these figures, Paul Otellini, president and CEO at Intel, said in the statement: "With outstanding execution the company performed superbly, growing revenue by more than US$10 billion and eclipsing all annual revenue and earnings records."

He added that for 2012, the company is "excited" about the global growth opportunities presented by ultrabooks, the data center, security and the introduction of Intel-powered smartphones and tablets. It is projecting first-quarter revenue of US$12.8 billion, the statement noted.

In a separate Reuters report on Thursday, the chipmaker said it will raise capital expenditure to US$12.5 billion this year, which is an increase from last year's US$10.7 billion.

Patrick Wang, analyst at Evercore Partners, told Reuters that this increase was unexpected. "The biggest surprise is the capex for the new year. They're investing to catch up and not only be at parity but exceed where the handset incumbents are," he noted.

Another analyst, Beau Skonieczny, noted in a statement Friday that strategic hardware partnerships will be a "key driver" for Intel's success in mobile devices as it looked to overtake market leader and rival ARM. The research analyst for computing practice at Technology Business Research (TBR) pointed to the multiyear, multidevice partnership with Motorola Mobility, which would see Intel's processors in the phone maker's Android devices, as an example.

He added that Intel is also reaching outside the U.S. to gain traction among smartphones globally. For instance, the Lenovo K800 smartphone, expected to ship in second quarter of this year on China's Unicom network, will also be powered by Intel's Medfield mobile processor.

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