INDUSTRY

SANTA CLARA, CA -- Intel Corporation today announced first-quarter revenue of $6.8 billion, down 3 percent sequentially and up 2 percent year-over-year. First-quarter net income was $936 million, up 86 percent sequentially and up 93 percent year-over-year. Earnings per share were $0.14, up 100 percent from $0.07 in both the first and fourth quarters of 2001. In accordance with generally accepted accounting principles (GAAP), earnings in the 2001 periods reflect charges for the amortization of goodwill, which is no longer amortized in the current year with the adoption of FASB statement 142. Net income excluding acquisition-related costs(1) was $1.0 billion, up 2 percent sequentially and down 7 percent year-over-year. First-quarter earnings excluding acquisition-related costs were $0.15 per share, flat with the fourth quarter of 2001 and down 6 percent from the first quarter of 2001. Intel and Intergraph Corporation yesterday announced the settlement of certain patent infringement litigation. The companies signed a cross licensing agreement, and ownership of various patents was transferred to Intel. Under the agreement, Intel will pay $300 million to Intergraph and has recorded a charge to first-quarter cost of sales in the amount of $155 million. The remaining $145 million represents the value of intellectual property assets, which will be amortized over a number of years according to Intel's accounting policies. The first-quarter charge reduced earnings per share by approximately $0.01 on both a GAAP basis and excluding acquisition-related costs. Acquisition-related costs in the first quarter consisted of $111 million in amortization of acquisition-related intangibles and other costs. Intel expects to continue to report earnings excluding acquisition-related costs through 2002 to provide a consistent basis for financial comparisons. ``Intel's aggressive R&D and manufacturing investments paid off in the first quarter, helping our product mix and profitability in a generally soft environment,'' said Craig R. Barrett, chief executive officer. ``While demand in emerging markets remains solid, established markets such as the United States and Europe continue to be impacted by weak IT spending. ``We picked up the pace of new product introductions, launching the world's most powerful desktop microprocessors -- the Pentium® 4 processor at 2.2 and 2.4 GHz -- along with the first mobile Pentium 4 processors and the first Xeon(TM) processors based on our NetBurst(TM) microarchitecture,'' Barrett continued. ``We also introduced a wide range of products based on our new XScale(TM) core for cell phones, PDAs and network processing. Going forward, we believe our industry-leading products and manufacturing efficiencies set the stage for better results when industry demand picks up.'' During the quarter, the company paid its quarterly cash dividend of $0.02 per share. The dividend was paid on March 1 to stockholders of record on Feb. 7. Intel has paid a regular quarterly cash dividend for more than nine years. Also during the quarter, the company repurchased a total of 30.9 million shares of common stock at a cost of $1.0 billion under an ongoing program. Since the program began in 1990, the company has repurchased approximately 1.6 billion shares at a total cost of approximately $27 billion.