Intel Q1 2009 net income down 55 percent but better than expected

Intel reported a first quarter revenue of $7.1 billion with a net income of $647 million, or 11 cents per share. Revenue has dropped 26 percent year-over-year while net income has plunged by 55 percent. Wall Street analysts had expected the chip giant would report earnings per share of 3 cents on a revenue of $7 billion.

Intel CEO Paul Otellini believes the PC market has hit a bottom last quarter, but the company refuses to provide an official revenue outlook at this time. However, for internal purposes Intel is currently planning for second quarter revenue approximately flat to the first quarter. The chip giant is seeing a return to seasonality, which would imply an uptick for the second quarter but they have no idea how big it will be.

“We believe PC sales bottomed out during the first quarter and that the industry is returning to normal seasonal patterns," said Paul Otellini, Intel president and CEO. “Intel has adapted well to the current economic environment and we’re benefiting from disciplined execution and agility. We’re delivering a product portfolio that meets the needs of the changing market, spanning affordable computing to high-performance, energy-efficient computing."

Also interesting is that Intel Atom sales dropped 27 percent sequentially to $219 million.