Intel Q2 EPS Beats; Q3 Rev View Light, Cuts Year View

Intel (INTC) this afternoon reported Q2 revenue in line with expectations and earnings per share slightly better than expected.

Revenue in the three months ended in June rose to $13.5 billion, yielding EPS of 54 cents, on a GAAP basis. Excluding some costs, Intel reported 57 cents a share.

Analysts on average had been expecting $13.54 billion and 52 cents a share, or 54 cents, excluding some costs.

CEO Paul Otellini remarked, “As we enter the third quarter, our growth will be slower than we anticipated due to a more challenging macroeconomic environment.�With a rich mix of Ultrabook and Intel-based tablet�and phone�introductions in the second half,�combined with the�long-term investments we’re making in�our�product and manufacturing areas, we are well positioned for this year and beyond.�

The revenue number was below the mid-point of Intel’s forecast, $13.6 billion, offered back on April 17th. Intel said its sales of NAND flash memory chips was “soft” in the quarter, and Otellini later remarked on the company’s conference this evening that the NAND results were the primary reason for that.

Gross margin came in at 64.4%, down from Q1′s 65.1%, on a non-GAAP basis.

PC client unit volume rose 3% from Q1′s level, the company said, while average selling prices declined 2%.

For the current quarter, the company sees $13.8 billion to $14.8 billion in revenue. At the midpoint, $14.3 billion, that projection is below the current $14.58 billion estimate.

The company expects gross margin of 63% to 64% in Q3, on a non-GAAP basis, down from last quarter’s level.

Additional color is available in CFO Stacy Smith‘s commentary.

For the full year, the company cut its revenue growth outlook to a range of 3% to 5%, versus a prior range for “high-single-digit” growth, year over year.

The company expects gross margin of 64% to 65% for the full year on a non-GAAP basis, plus or minus a couple of percentage points.

Intel shares are down 3 cents at $25.35 in late trading.

Intel management will host a conference call�with analysts at 5 pm, Eastern time, this afternoon, and you can catch the webcast of it here.

Update: The shares have now reversed course and are higher by 27 cent at $25.65 in late trading.