Intel stock price dip as report outlines microprocessor glut Tom Foremski
Intel suffered a major drop in its share price on Friday after an influential analyst said that the company would produce more microprocessors than it can sell.
Intel's share price dropped 5 per cent on heavy trading of more than 24.6 million shares, in response to Merrill Lynch analyst Thomas Kurlak's comments. Kurlak's research report stated that the PC market was rapidly heading toward a glut of microprocessors and that slowing growth in PC markets would not be able to absorb the supply.
Kurlak pointed to increased production by Intel thanks to a move to 0.25 micron production, and increased numbers of microprocessors produced by Intel competitors Advanced Micro Devices and National Semiconductor.
In separate news, Intel said it would establish a separate networking business to take advantage of business opportunities in the fast growing sector.