Intel (NASDAQ:INTC) may have had a roaring quarter. Wall St. did not give it back much. The stock barely moved after hours. That is extraordinary given that Intel profits were up 25% from the same quarter a year ago and its forecasts were robust.
Shareholders in a bear market cannot help themselves. Good news gets lost in the fog of a falling market.
Intel did give the market a special gift. It told investors that a very large portion of the tech industry will be OK this quarter. Since it has over 80% of the server and PC chip markets and it credited global notebook sales with much of its success, an entire basket of companies are likely to be just fine.
First and foremost on the list of firms that Intel’s numbers aid are the PC and servers manufacturers. Even Sun (JAVA), whipping boy of the old-line tech firms, said it had a reasonable quarter selling its odd brand of servers and software. Intel’s strength signals relatively hearty sales for Dell (DELL) and HP (HPQ). A portion of IBM’s (IBM) results should also be strong.
The next critical tech earnings report is due from Microsoft (MSFT) No other company benefits more from a good PC and server sales environment. It would be almost impossible for Intel to do very well and Microsoft to do poorly.
Intel sent a beacon that can be seen from far away. Tech company holders can spot it and understand that, at least this quarter, their industry is not being dragged down with the rest of the world.
Copy of Intel earnings call transcript.
Douglas A. McIntyre
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