Intel trounced Wall Street expectations on Tuesday, announcing that fourth-quarter earnings rose 18 percent on strong sales of its microprocessors.
After the markets closed, the chip king reported a net income of US$2.1 billion, or $1.19 a diluted share, for the quarter ended 26 December, up from $1.7 billion, or 98 cents, a year ago.
Analysts were expecting earnings of $1.07 a share, according to research firm First Call.
Intel's (INTC) revenue jumped 17 percent to $7.6 billion from $6.5 billion a year ago.
"Intel achieved its 12th consecutive year of revenue growth in spite of the challenges of a turbulent market in 1998," said Craig Barrett, president and chief executive.
The fourth quarter represents a remarkable recovery for the world's biggest chipmaker. In the first two quarters of the year, Intel was caught without enough low-cost chips for low-cost computers. The Santa Clara, California, company introduced several new chips during the year to meet the new demand. It also benefited from PC companies burning off unsold inventory.
Intel set new quarterly records for revenue, net income, earnings per share, and microprocessor unit shipments, the company said. Intel saw record revenue in the Americas, Europe, and the Asia-Pacific region.
But Intel warned that its first-quarter revenues would be down from fourth-quarter revenues, due to "seasonal factors."
Gross margin percentage in the first quarter of 1999 will also be down slightly from 58 percent in the fourth quarter, but gross margin for 1999 will be up to 57 percent from 1998's 54 percent, the company said.
Shares of Intel closed down $4.18, or 3 percent at $135.56.
