Recent statements from processor maker Intel (NASDAQ:INTC) and electronics and IT distributor Avnet (NYSE: AVT) that PC sales may have hit bottom may not be so far off the mark, even if processor maker AMD (NYSE: AMD) disagrees.
Supply chain checks this month into second quarter PC builds with the
top five notebook original design manufacturers (ODMs) and the top four
desktop motherboard makers both show improvements over checks from the
previous month. FBR Research issued a brief report of the findings this
week.
“For Q2 our contacts now expect notebook units to grow 14 percent
quarter over quarter, better than our month-ago forecast of 10 percent
growth,” the company says in its report. “Desktop builds should decline
2 percent quarter over quarter, in line with our month-ago forecast.”
FBR attributes the positive revision to the continued momentum for
netbooks, and says that it believes Intel’s guidance for its next
quarter was “conservative.”
“We think Intel should grow revenues by 3 percent to 4 percent
sequentially in Q2 (on the 7 percent sequential growth in PC builds),
better than the firm’s sequentially flat revenue guidance.”
However, not all the news is good for Intel. FBR Research says it
remains concerned about the potential for Intel’s Atom processor — the
one that powers so many of the netbooks on the market today — to steal
away business from Intel’s more profitable and more powerful processors
that go into standard laptop computers and desktop computers.
“We are concerned about the cannibalistic impact that the Atom
processor may have on Intel as the firm ships many more chips (Atoms)
that have fewer gross profit dollars per chip,” FBR Research says.