Page last updated at 06:42 GMT, Wednesday, 16 July 2008 07:42 UK

Strong laptop sales boost Intel

Intel micro processing chip
Analysts had feared that demand for PCs was on the wane

Intel, the world's biggest maker of microchips, has reported a 25% jump in profits for the three months to the end of June.

Record sales of laptop chips boosted the firm's net income to $1.6bn (798m), up from $1.28bn a year ago.

The results pleased analysts, who feared that demand for computers was being hit by the tougher economic climate worldwide.

Intel was positive about further growth opportunities in the year.

"As we enter the second half, demand remains strong for our microprocessor and chipset products in all segments and parts of the globe," said Paul Otellini, Intel president and chief executive.

Weaker pricing

Soaring demand for laptops and cut-down versions called notebooks has helped Intel continue to prosper.

But lower prices for some of the best-selling models drove down Intel's prices, which cut into profit margins over the quarter.

Analysts took heart from the figures.

"The only mild disappointment was in the gross margin line due to a higher mix of low-end notebooks, but overall I think the result was a surprise on the positive side, given the macro environment," said CRT Capital Group analyst Ashok Kumar.

Intel is the first major technology firm to report its second-quarter earnings figures.

Rival Advanced Micro Devices, Google, International Business Machines (IBM) and Microsoft will all report their results for the past three months this week.

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