Intel Breaks Down Revenue-Pulling Sectors

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March 31, 1999 (8:41 AM EST)

By Mark Hachman,

In an accounting statement filed with its annual report, Intel reported its 1998 revenue by certain product segments, as required by new Securities and Exchange Commission regulations. For 1998, Intel reported an operating profit of $8.38 billion on revenue of $26.8 billion.

The report breaks down Intel's revenue and profits by three categories: the Intel Architecture Business Group, representing its desktop, mobile, and workstation/server microprocessors; the Computing Enhancement Group, consisting of Intel's chip sets, embedded microprocessors and microcontrollers, flash memory, and flash memory products; and "All Other," an arbitrary grouping consisting of Intel's Network Communications Group and the New Business Group.

For 1998, Intel's Architecture Business Group returned $9.08 billion in profits and $21.5 billion in revenue. But the Computing Enhancement Group reported only $358 million in profits on revenue of $4.05 billion. The All Other category, which makes up Intel's networking products, plus videoconferencing terminals, help desk software, and its digital-camera manufacturing kits, generated an operating loss of $1.06 billion, producing revenue of merely $681 million.

Intel's accounting also shows the company aligning more with strategic customers. In 1998, one customer accounted for 13 percent of Intel's revenue and another customer accounted for 11 percent. In 1997, only a single customer accounted for more than 10 percent of Intel's revenue, while in 1996, no customer exceeded 10 percent of Intel's revenue.