Intel Corp (INTC)

[ibc]

Intersil CEO

Let's start with computing, which grew sequentially by 5% in Q3 and represented 22% of company revenue. Demand was strong for much of the quarter, with some customers expediting orders. In addition, at the beginning of the summer, several end customers requested that our distribution partners carry a higher level of inventory in anticipation of strengthening demand. Starting mid-September, we saw a reversal in order patterns with bookings slowing significantly. Fourth quarter was always expected to be the low quarter for the year in this business, but now, the lower revenue will be aggravated by the drawdown of inventory at our distributors. Slowing demand and the inventory correction are expected to impact our computing revenue by as much as 20% to 25% sequentially in Q4. Roughly half of that decline reflects lower PC builds and about half is related to the inventory depletion.