Asia Pacific to fuel growth — Intel

Computer chip giant Intel Corp. president Paul Otellini said early this week he is optimistic of revenue growth in 2002 after "two tough years" and expects the Asia Pacific region to fuel turnover.

"I am getting increasingly optimistic about our prospects and industry prospects this year. Frankly after two tough years in the industry, it seems very refreshing to be able say that," he told reporters during a visit to the Philippines as part of a regional tour that includes Malaysia, China and Taiwan.

Intel, the world’s largest computer chip maker, reported in January a fourth-quarter profit excluding one-time costs of $998 million, up sharply from the prior quarter but down by 62 percent from a year earlier.

Fourth-quarter revenues were $7 billion , a seven-percent increase over the previous quarter, but a 20-percent decline from last year’s same quarter.

Last year saw the first-ever slump in the semiconductor industry, as consumers and corporations cut back on technology buying. However, the fourth quarter showed improvement after a horrific third quarter.

Otellini said he expects the Asia Pacific region to remain Intel’s biggest market.

For the first time in the last quarter, Asia emerged the top market for Intel, beating the dominant US market, he said.

"I don’t see that trend abating," Otellini said. "I think the Asia Pacific is likely to remain the largest geography over time.

"It indicates that firstly, more and more computer manufacturers are moving to Asia independent of where the computers are being consumed. Secondly, more and more consumers – businesses and individuals – are buying computers for local consumption in the Asia Pacific," he said.

The Asia Pacific region makes up 35 percent of Intel’s revenues, followed by the Americas with 33 percent and Europe 25 percent.

Intel employs more than 15,000 people in Asia Pacific, with 35 sales and marketing offices spanning 14 countries. It operates advanced facilities in Malaysia, the Philippines and China.

Otellini said Intel would spend $5.5 billion in new investments this year throughout the globe in addition to $7.5 billion spent in 2001.

The company would also invest $4 billion on research and development under its global budget this year as part of its plan to produce 4,000 new products into the market.

In the Philippines, Intel would spend up to $100 million this year on expanding capacity as part of its objective to make the plant here its largest and most advanced assembly and testing facility in the world, company officials said.