Weak PC sales forces tech giant to cut quarterly outlook as its stock slides.
BY JACOB PALMER | OB DIGITAL NEWS EDITOR
Weak PC sales forced tech giant Intel to cut its quarterly outlook by $1 billion Thursday.
As a result, share prices decreased 4.7 percent, OregonLive.com reports.
Previously, Intel had told investors to expect quarterly sales around $13.7 billion. That implied healthy growth from 2014, when first-quarter revenue totaled $12.6 billion.
Instead, the world’s largest chipmaker now says quarterly revenue will be roughly $12.8 billion.
In a written statement, Intel explained: “The change in revenue outlook is a result of weaker than expected demand for business desktop PCs and lower than expected inventory levels across the PC supply chain.”
The company also told investors that its annual revenue forecast would need revision as well, and the company said it will release an updated forecast in April.
Intel identified a changing PC market as the reason for its downward revision, the Portland Business Journal reports.
“The company believes the changes to demand and inventory patterns are caused by lower than expected Windows XP* refresh in small and medium business and increasingly challenging macroeconomic and currency conditions, particularly in Europe.”
Last year the company had record earnings and credited the “reinvigorated” PC business for part of that. The data center business, which has been strong, is meeting expectations, according to the statement.