[R]8:00AM New York - Intel Corporation post $2.3 billion fourth quarter profit and offered lackluster outlook.[/R]

Revenue

Intel Corporation reported Tuesday fourth quarter revenues to December 31, 2007 climbed 10.5% to $10.7 billion from $9.69 billion reported in the year ago quarter, helped by stronger sales in new products.

Net income leapt 51.3% to $2.27 billion compared with $1.5 billion posted a year earlier.

Earnings

For the quarter, earnings rose 46.2% to 38 cents per share from 26 cents per share in 2006. The figure marginally missed estimates. Analysts surveyed by Thomson Financial were looking for 40 cents per share on revenues of $10.84 billion.

In the year, net income gained 38.3% to $6.97 billion or $1.18 per share from $5.04 billion or 86 cents per share in 2006. Revenues rose to $38.33 billion from $35.38 billion in the year ago quarter.

Outlook

The company said it expects a gross margin of 56% during the current quarter. In the fourth quarter, Intel had a gross margin of 58%, compared with its forecast of 57%

Intel also said it expects to see capital expenditures of $5.2 billion in 2008.

Intel’s earnings outlook also depicts that the economic slowdown in the U.S., which has been induced by the subprime mortgage market turmoil, is now pinching the technology industry.

The tech market, particularly the chipmakers and the chip-making equipment manufacturers have been reeling from a glut in NAND chips, which has led to a decline in prices.

Company chief executive, Paul Otellini said the company would be cautious going into 2008, particularly given the competitive pricing in the market for NAND flash memory chips.

“You hear all the pundits saying that the world is going to go to a trash basket, and you worry,"""" Otellini in a conference call Tuesday.

""""Maybe a self-fulfilling prophecy. At this point we don''t see anything on the horizon. ... If there''s any near-term concern, I think it tends to be focused on the U.S. market. ... It would be imprudent not to be cautious about it, though.

Intel, the world’s biggest maker of computer microprocessors has also gained market share from rival firm Advanced Micro Devices Inc, especially in the market for computer servers, which carry higher profit margins than desktop PCs.

During the quarter, Intel introduced 32 microprocessors based on the company’s breakthrough 45nm process technology with Hafnium-based high-k metal gate technology, extending the company’s leadership in energy-efficient processing. Intel’s 45nm ramp has been the fastest in company history.

Intel Corporation shares slumped as much as 12% in early morning trade Wednesday after the technology group provided disappointing earnings outlook.

The company stocks lost $2.70 to $19.99 after lowering first quarter to March 31, 2008 revenues to between $9.4 billion and $10 billion. The share gained 2% in the fourth quarter closing at $26.66.

The midpoint of Intel''s guidance, $9.7 billion, is below the current consensus estimate of $9.97 billion.