Second-quarter revenue looks flat, Intel CEO says

The PC industry is not going to see a sequential increase in revenue during the current quarter, as corporate spending on IT infrastructure remains weak, according to Intel Corp.'s chief executive officer.

"We're looking at a relatively flat second quarter," Craig Barrett said, speaking at a press conference following a speech he gave here on education.

Last month, Intel announced it expected to see its second-quarter revenue come in between US$6.4 billion and $7.0 billion, compared to revenue of $6.78 billion during the first quarter. [See "Intel matches Q1 forecast," April 17.]"I don't think you're going to see any substanital uptick in the industry until corporate profits increase and we see the investment in the corporate IT infrastructure take place," Barrett said. "We've seen relatively strong announcements of GDP (gross domestic product) growth in the United States but as far as I can tell that hasn't translated into corporate profitability or corporate IT investment yet."

In the absence of corporate spending, the PC industry will not see a full recovery, despite relatively stronger consumer spending and strong sales in emerging markets, such as China, Eastern Europe and Latin America. "We're still very much in a latency mode," he said.

The industry won't break out of that holding pattern until corporate profits in Western Europe, North America and Japan recover, Barrett said.

"Wish I had better news," he said.

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