Intel cuts prices, analysts cut Q3 estimates

Intel completed a round of cuts in the prices of its processors Monday, reducing the price of its flagship Pentium 4 desktop processors, its mobile Pentium 4-M processors, its desktop and mobile Celeron processors, and its Xeon processors for workstations and low-end servers. At the same time, financial analyst firms warned of slower-than-expected sales, and revised their guidance downward for Intel's third quarter numbers.

The price cuts had been widely expected after Intel introduced on August 26 several new desktop Pentium 4 processors at clock speeds up to 2.8GHz. Intel at the time cut the price of its previous clock-speed leader, the 2.53GHz Pentium 4, and needed to cut the prices of slower Pentium 4s to bring the slower chips into line with the high-end prices.

The 2.4GHz Pentium 4 now costs US$193 in 1,000-unit quantities, down from $400, a decrease of 52 percent. The 2.26GHz and 2.2GHz chips also now cost $193, down from $241. The 2.0GHz chip costs $163, down from $193, and the 1.8GHz chip costs $143, down from $163.

Intel's fastest mobile processor, the 2.0GHz Pentium 4-M, now costs 45 percent less at $348, down from $637. The 1.9GHz Pentium 4-M is down to $241, a drop of 40 percent, the 1.8GHz chip now costs $198, down 43 percent, and the 1.7GHz chip now costs $171, down 29 percent.

The company's desktop Celeron processors were reduced by an average of 16.75 percent, and its fastest mobile Celeron processor, at 1.5GHz, was cut 44 percent to $96. Lower end Xeon processors were cut by an average of 16.67 percent. High-end Xeon and Itanium processors for servers were not affected by the latest round of price cuts.

The price cuts and new processors were expected to stimulate demand for PCs featuring the new processors, but that strategy has continued to be derailed by a sputtering economy.

Financial analyst firm Investec Inc. said Tuesday it is lowering revenue and earnings per share estimates for the third quarter and fiscal year, based on a survey of retail consumer electronics stores that indicated a weaker back-to-school market. The back-to-school market is the second-most important season for PC and processor sales, the fourth-quarter holiday season carrying the most weight.

Investec now expects Intel to earn $6.5 billion in the third quarter, down from its previous estimates of $6.7 billion. Earnings per share for the third quarter will now be $0.12 per share, down from $0.13, Investec said. The company also lowered expectations for Intel's 2002 and 2003 full-year results.

Analysts surveyed by Thomson Financial/First Call expect Intel to earn $0.13 per share in the third quarter.

Intel, based in Santa Clara, California, provided its own guidance for third-quarter revenue of between $6.3 billion and $6.9 billion when it announced its second-quarter results. Intel shares (INTC) were down $0.64, or 3.84 percent, to $16.03 in late-morning trading.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Tom Krazit

PC World
Show Comments

Cool Tech

Toys for Boys

Family Friendly

Stocking Stuffer

SmartLens - Clip on Phone Camera Lens Set of 3

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?