Intel's second-quarter profit plunged by 57 per cent as the world's largest chip maker struggled with stiff competition and a shift in demand toward less expensive products.
The company also posted a disappointing revenue forecast of $8.3 billion (Euro 6.65 billion) to $8.9 billion (Euro7.13 billion) for the current quarter - less than the $9.04 billion (Euro7.24 billion) expected by Wall Street analysts.
Revenue fell 13.2 per cent to $8 billion (Euro 6.41 billion) at the low end of a forecast Intel delivered in April.
Analysts had been expecting a second-quarter profit of 13 cents a share on sales of $8.26 billion (Euro 6.62 billion), according to a survey by Thomson Financial.
Intel's sales decline was spread across most of its geographic regions and came as computer makers reduced their inventory to make way for new Intel products.