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Tuesday, February 03, 2009

Intel CFO Sees Opportunity in Recession

By Joanna Ossinger

FOXBusiness

Intel (INTC) is suffering amid the economic downturn along with everyone else, but also sees it as a perfect opportunity to gain a competitive advantage over its rival, Chief Financial Officer Stacy Smith told FOX Business in an interview Tuesday.

Smith said the downturn hit Intel hard in October, and that the economic outlook is “grim.” But he said that one possible silver lining is that the supply chain seems to be adjusting more rapidly in this downturn that it has in recessions past.

Smith said Intel is “certainly going to try” to keep its work force at its current levels. He noted that the company had gone through a restructuring previously, and its staffing levels are more than 20% lower than they were three years ago, so it has already gone through the process other companies are undertaking now.

Now, Smith said Intel is “going forward with pretty significant investments,” including $5 billion in capital spending this year, to try to boost its advantage over competitors. He asserted that other companies in the arena are cutting spending, and Intel sees this as the perfect time to increase its dominant position in the sector. Advanced Micro Devices (AMD) is normally considered Intel's biggest rival in the field.

Smith said Intel typically has a three-quarter lead over the rest of the market, and “would love to get it up to six quarters” with these investments.

Smith says he likes the Obama Administration’s focus on technology and infrastructure, though he worries about “an anti-business backlash” as well. He says he’d like to see the U.S. invest more in education, particularly in math and science.

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