Intel records strongest quarter in 30 years

Paul Otellini: There is compelling evidence for a refresh out there

Intel has had its strongest financial quarter in 30 years, although profits are down on last year.

The company recorded profits of nearly $1.9bn (£1.2bn), well above estimates, and revenues of $9.4bn (£5.8bn), up $1.4bn (£875m) from the previous quarter. The sales recovery was spurred by demand in Asia and Brazil, but established markets such as Europe and the US were also on the mend.

The enterprise market was doing well on the server side, but not so well on client sales. Chief executive Paul Otellini said that a lot would depend on next year's office PC refresh cycles.

"It's on the client side that the lights have been out for some time now," he said. "It comes down to chief financial officers and chief information officers setting budgets for capital expenditure in 2010. There is compelling evidence for a refresh out there. People are going to want to move to Windows 7."

Otellini said that Intel itself had been holding off from buying new PCs for its offices, but was now doing so since the cost of running its 'ageing fleet' had grown too high.

As for cloud services and visualisation, Otellini said "bring it on", adding that the expected growth in datacentres would drive sales of the company's more advanced server processors.