Intel (INTC) Cuts Guidance After Flaw Found with New Processors
Tweet Send to a Friend
Get Alerts INTC Hot Sheet
Price: $23.92 -0.54%
Revenue Growth %: -2.3%
Financial Fact:
Interest and other, net: -50M
Today's EPS Names:
ANF, DXLG, FL, More
Revenue Growth %: -2.3%
Financial Fact:
Interest and other, net: -50M
Today's EPS Names:
ANF, DXLG, FL, More
Trade INTC Now!
Intel Corp. (NASDAQ: INTC) cut its full-year outlook on Monday due to an identified chipset design error with its forthcoming Sandy Bridge line of second-generation Core processors.
The world's largest manufacturer of microprocessors said the Serial-ATA ports in the chipsets may degrade over time. The company said that it has identified and corrected the issue, and has begun manufacturing a new version of the support chip.
Intel said that it expects to begin delivery of the updated version of the chipset in late February, with full volume recovery in April.
The company said that its sees a total cost of $700 million, forcing it to cut its forecast for sales in the first quarter by $300 million to $11.7 billion +/- $400 million, compared tot eh Street's view of $11.46 billion.
Intel also sees the issue cutting its first quarter gross margin about 2 percent compared to its prior view, adding that full year sales will not be impacted.
"The company expects to begin delivering the updated version of the chipset to customers in late February and expects full volume recovery in April. Intel stands behind its products and is committed to product quality. For computer makers and other Intel customers that have bought potentially affected chipsets or systems, Intel will work with its OEM partners to accept the return of the affected chipsets, and plans to support modifications or replacements needed on motherboards or systems," Intel said in a statement.
Shares of Intel are halted in early market movement on Monday, with trading set to resume at 10:20am.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
The world's largest manufacturer of microprocessors said the Serial-ATA ports in the chipsets may degrade over time. The company said that it has identified and corrected the issue, and has begun manufacturing a new version of the support chip.
Intel said that it expects to begin delivery of the updated version of the chipset in late February, with full volume recovery in April.
The company said that its sees a total cost of $700 million, forcing it to cut its forecast for sales in the first quarter by $300 million to $11.7 billion +/- $400 million, compared tot eh Street's view of $11.46 billion.
Intel also sees the issue cutting its first quarter gross margin about 2 percent compared to its prior view, adding that full year sales will not be impacted.
"The company expects to begin delivering the updated version of the chipset to customers in late February and expects full volume recovery in April. Intel stands behind its products and is committed to product quality. For computer makers and other Intel customers that have bought potentially affected chipsets or systems, Intel will work with its OEM partners to accept the return of the affected chipsets, and plans to support modifications or replacements needed on motherboards or systems," Intel said in a statement.
Shares of Intel are halted in early market movement on Monday, with trading set to resume at 10:20am.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
You May Also Be Interested In
- Abercrombie & Fitch Co. (ANF) Misses Q1 EPS by 4c; Guides FY Below Views
- Aeropostale, Inc. (ARO) Tops Q1 EPS by 1c; Guide for Wide Q2 Loss
- Intel (INTC) Processor Might Replace ARM (ARMH) in Galaxy 10.1
Create E-mail Alert Related Categories
Corporate News, Guidance
Login with Facebook
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
