Intel 2012 Quarter 1 Earnings Fall As Research and Marketing Costs Rise

The first quarter earnings of Intel, the world’s largest chip-maker, fell 13 percent contrary to expectations as the company reported flat revenues and rising research and marketing costs.

The Associated Press, reporting from New York today said Intel’s 1st quarter net income was $2.74 billion, down from $3.16 billion during the same period last year. This translated to earnings of 53 cents per share during the opening first three months of the current year, compared to 56 cents last year.

Revenue was flat at $12.9 billion, but did better than expected as analysts predicted revenues to total $12.8 billion. Intel also did better than predicted in its share values as it closed the first quarter of the year at 53 cents, higher than the expected 50 cents per share.

In yesterday’s trading, Intel’s shares hit a seven-year high of $28.78 in regular trading but fell 68 cents in extended trading, closing at $27.79, or 2.4% lower.

In its report for the quarter, Intel said its launch of a new generation of chips for server computers accounted for some of the increase in the company’s expenses. Intel is set to introduce a new set of chips soon, and insiders said the first smartphone with an Intel chip may reach the market very soon from an unnamed mobile phone manufacturer.

The company is also deep in its campaign to support the so-called ultra-books, thin, light lap tops modeled after the popular Apple MacBook Air. All major PC makers had responded to Intel’s call for the new generation of light laptops as the mobile computing trend veers toward notebooks and tablets.

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