Intel, IBM post solid results

Intel's sales warning had already hurt the market

Chip maker Intel, which helped fuel the recent slump in world stock markets, has beaten analysts' lowered expectations.

Its profits before one-off charges in the third quarter of 2000 rose 52% to $2.9bn, from $1.9bn in the same period a year ago.

Sales rose 19% to $8.73bn from $7.33bn a year ago. Sales were up 5% on the second quarter, lower than than 9-12% the market had been expecting before Intel's trading downgrade last month.

Intel shares, which have fallen 50% in recent weeks, were little changed at $36.2 before the earnings announcement.

The prospect of results from Intel had kept the markets nervous on Monday and Tuesday, especially with results also due from computer giant IBM.

IBM profits up

After US markets closed on Tuesday IBM reported profits up 11% on a year earlier to $1.96bn in the third quarter.

Sales during the July to September period rose 3% to $21.8bn.

IBM chairman Louis Gerstner said the sales increase could have been higher.

"Demand for our microelectronics products - from both outside customers and internal IBM customers - far outstripped our ability to supply components.

"Second, the upcoming release of our new high-end server slowed demand for the System 390 family of servers. Finally, parts of our software business slowed unexpectedly in September."

Sales fell 3% to $5.6bn in Europe, the Middle East and Africa.

Hardware revenues climbed 4% in the third quarter of 2000 compared with the same period last year, reflecting an increase in personal computer sales.

Sales in the nine months to 30 September are 1% lower than 1999 at $62.8bn.