Intel CFO Andy Bryant details reasons for Q4's disappointing revenue in a quarterly conference call yesterday:
Revenue for the fourth quarter was $10.2 billion, at the low end of the range we forecast in the October earnings release and in the low [end] of the range in the December update. Although revenue grew a little over 2% in the third quarter, this is lower than is typical for this period. Compared to the fourth quarter a year ago, revenue grew approximately 6%. Revenue for the second half was up 8% over the first half, within the range for the last five and ten years and approximately 12% from the second half of 2004.
Asia-Pacific was flat in the third quarter, at the lower end of historical range, primarily due to softness in the desktop segment. In the Americas revenue was almost 4% with most of the decline concentrated in United States, offset somewhat by growth in Latin America. Year-to-year growth for the fourth quarter was led by Asia-Pacific at 16% and Japan at 11%, driven by demand for mobile computing, chipsets and flash memory. Europe was flat with the fourth quarter a year ago. The year-to-year decline of 10% for the Americas region is primarily a function of continuing movement of sales or manufacturing to Asia-Pacific. For the year overall, Asia-Pacific was nearly half the total revenue, followed by Europe with 21% of revenue.
A little less than two-thirds of the total revenue came from digital enterprise group, which was flat with the third quarter and down 5% from a year ago. Operating profit for the digital enterprise group was up 13% sequentially and flat from a year ago. Revenue in Intel’s mobility group accounted for nearly one-fourth of total revenue. Revenue from mobile microprocessors was up 3% from the third quarter and 40% from a year ago. With the success of mobile platforms, revenue from mobile chipsets and other products was up 66% year-to-year. The mobility group also made progress in operating profit, up 8% from the third quarter and 63% from the year ago.
Our flash memory business revenue was up 5% from the third quarter, although flat from 2004 overall. For the entire year, flash memory was flat from revenue in 2004. With the formation of IM Flash technology, the joint venture with Micron, we will report flash memory revenue and operating profit as part of a new operating segment.