The company, based in Santa Clara, Calif., reported a 90 percent drop in net income on Thursday, to $234 million, or 4 cents a share, for the fourth quarter. In the same period of 2007, it earned $2.3 billion, or 38 cents a share. Intel said the most recent quarter’s results, which were in line with Wall Street’s expectations, included a billion-dollar reduction in the carrying value of the company’s investments in Clearwire.
Intel has laid the groundwork for a fresh assault on the mobile device market with the Atom processor, which today goes into inexpensive laptops known as netbooks and which will eventually sit inside smartphones. In addition, Intel wants to play a larger role in the consumer electronics market, with chips for televisions and other gadgets, and to enter the high-end graphics processor market.
Those forays put Intel up against competitors like Samsung and Texas Instruments. Intel is betting that it can gain an edge on these companies by shifting to a more advanced chip manufacturing process this year, which will allow it to make cheaper, less power-hungry products.
To deal with waning demand, Intel will pull back on capacity at its existing factories and try to keep cutting costs elsewhere in the business. Citing economic uncertainty, Intel declined to provide a first-quarter revenue forecast, although it warned that gross profit margins would decline significantly.