Intel has cut its Q3 forecast, with guidance lowered from $13.8 billion-$14.8 billion down to $12.9 billion-$13.5 billion. That's a substantial drop in sales, attributed to factors including weakness in Asia and the slowing growth of emerging markets.
It's the lagging PC market that spells out the biggest problems for Intel, though. Fool.com analyst Andrew Tonner has long been bullish on the chip maker as a franchise-type business, but Intel's fortunes are so closely tied to PC manufacturing that any difficulties in that arena can and will drag down earnings.
All eyes have been on Windows 8 as the single best hope to drive potential upgrade cycles for PC makers. However, as consumer trends continue in favor of smartphones and tablets for personal-computing needs, it appears that even the release of Microsoft's long-awaited new operating system may prove an insufficient catalyst to revive the PC market.
Of course, when it comes to dominanting markets, there's no question that Intel still holds top place in the PC microprocessor arena. That market is maturing, though, and Intel will find itself in a precarious situation for the longer term if it doesn't locate new avenues for growth. In this premium research report on Intel, our analyst runs through all of the key topics investors need to know when it comes to the chip giant. Furthermore, you'll continue to receive updates as news develops for an entire year. Click here now to learn more.
The article Ailing PC Market Chips Away at Intel's Earnings originally appeared on Fool.com.
Andrew Tonner has no positions in the stocks mentioned above. You can follow Andrew and all his writing on Twitter: @Andrew Tonner. Brendan Byrnes has no positions in the stocks mentioned above. The Motley Fool owns shares of Intel and Microsoft. Motley Fool newsletter services recommend Intel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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