The last time Intel Corp. pulled in profit this big, dot-com delirium was in full swing and Internet fever fueled spectacular computer sales.
Now, as the technology industry recovers from a slump caused by the financial meltdown, the world’s No. 1 semiconductor company has reported its biggest quarterly net income in a decade on signs of vibrancy in the most troubled corner of the computer market.
Intel shares shot up $1.19, or 5.7 percent, to $22.20 in morning trading Wednesday.
Large corporations are now buying more computers that use Intel’s most expensive chips, an encouraging sign for the overall economy that emerged from Intel’s second-quarter numbers, which were reported Tuesday after the stock market closed. Corporations have been stingy on upgrading their workers’ personal computers, a trend Intel is now seeing reverse. Intel gets most of its profit from the sale of chips that go into PCs.
Intel CEO Paul Otellini said companies are starting to replace 4- and 5-year-old PCs now that they have some “breathing room in the economy and their budgets.” Intel has unique insight because it owns 80 percent of the worldwide market for microprocessors, the “brains” of PCs and servers.
The numbers offer further evidence that companies are freeing their technology budgets, which should have helped other big technology companies. Intel’s main rival, Advanced Micro Devices Inc., reports its quarterly results on Thursday, while IBM Corp. and Microsoft Corp. issue their numbers next week.
Intel’s results topped Wall Street’s forecasts, and the company raised its guidance.
Intel’s net income was $2.89 billion, or 51 cents per share, in the quarter ended June 26. Analysts expected 43 cents per share. The last time Intel’s quarterly net income topped $2.5 billion was in 2000 during the dot-com heyday.
In the year-ago period, Intel lost $398 million, or 7 cents per share, when it paid a…