Intel rallies investors with upbeat predictions

Intel is betting big on the Atom processor

Intel chief executive Paul Otellini has outlined his future plans for the company, which mainly revolve around Atom chips and small form factor devices.

In a webcast for investors, Otellini was upbeat about the state of the chip business, saying that the PC industry had bottomed out and that the situation was now "a little better than we expected". He acknowledged that it was early in the quarter, and that typically June was the most important month to watch, but added, "So far so good".

Otellini explained that Intel would continue to benefit from the popularity of netbooks, adding that the Atom chip, and accompanying technologies, would play a strong role in the firm's future.

"We will keep segmenting our products to go after new markets so that we can be competitive and profitable," he said. "The Atom was designed to go after a low-cost computing market, and we are now able to exploit that."

Otellini also argued that there was no slowdown in the growth of the internet, despite the worst economic recession in Intel's history.

"This is the fundamental driver for the silicon technology that we build, and the markets we are going after," he said. "We have improved cycle time and time to yield, and this is the heart of what makes Intel Intel. We are bringing that technology into a broader spectrum of products."

Otellini highlighted four growth areas as potential markets for devices running its Atom chips, each of which he said would be worth $10bn (£6.6bn) a year to Intel by 2011. These are netbooks, smartphones, connected consumer devices, and embedded devices such as cash machines, which will require a system on a chip.

Otellini had more good news for investors. "Employment is down 25 per cent, and we are more productive and building more complex products. We are more efficient and will bank $4bn [£2.6bn] of savings this year," he said.