Barrett should check with his CFO. From Intel's Q2 Conf Call 7/15/03:
Chief Financial Officer Andy Bryant said Tuesday that the company isn't seeing any evidence that a corporate replacement cycle for computers is occurring.Bryant noted that Intel has restarted a program to provide Intel employees with one home PC each. He said the program should be completed by the end of the year, with most of the costs coming in the third quarter. Intel had put that program on hold in 2001 as the company cut nonessential spending to address the downturn.
From Dow Jones Newswire:
"SANTA CLARA, Calif. (Dow Jones)--Intel Corp. (INTC) Friday raised its sales forecast for the third quarter, saying its processor business is generally trending higher, while demand for communications products remains soft."
"In a press release, the world's largest chip maker said it expects third-quarter revenue between $7.3 billion and $7.8 billion, compared with its previous forecast of $6.9 billion to $7.5 billion."
And just a month ago Intel saw no signs of increased demand (except for back to school sales which they were relying on). Yet Dell is slashing prices and HP sales missed forecasts (on agressive pricing) - so where's the demand coming from that only Intel now sees, but didn't a month ago?
This might be the back-to-school cyclical demand Intel mentioned - Again from the Q2 conf call:
Typically the second half of the year is better for Intel as it benefits from the back-to-school and holiday shopping seasons. Bryant said that historically Intel's revenue in the third quarter increases 5% to 7% sequentially. The midpoint of the company's third-quarter sales target, which stands at $6.9 billion to $7.5 billion, represents a 6% increase in sales, noted Bryant.