Even though Intel (Nasdaq:INTC) experienced an expected first-quarter drop in net income, falling to $1.44 billion, it reiterated its confidence that it was still on target for its projected profit-margins for 2008. The guidance helped the stock shoot up by 8 percent.
Intel said it expected to reach gross margins of 57 percent for the overall year, with the overall consensus being they would be more in the 56 percent range.
"The concern was that the memory business was dragging down the gross margins, which would drag down earnings," said Doug Freedman, an analyst at American Technology Research. "The general consensus was that it would be more like 56 percent."
Revenue
Revenue for the quarter did better than expected, as the company generated $9.67 billion, up from $8.85 billion. That beat Wall Street expectations by a little.
For the second quarter, Intel said it should reach revenue of between $9.0 billion to $9.6 billion. Analysts are looking for $9.26 billion.
The company was strong in the notebook market, Xeon processors and computer servers for the first quarter, said Intel CEO Paul Otellini. He added that microprocessors and chipsets helped offset the continuing challenges in the flash memory category.
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