Intel thrives but Britain's slump drags it back

Intel today painted a rosy picture for this year but said the recovery in Britain's recession-battered PC market was lagging behind the rest of the world.

The firm which provides "brains" for computers, barometer for the PC market and technology spending, posted fourth-quarter profits of $2.3 billion (£1.4 billion), nearly 10 times as much as the $234 million a year before.

However, profits for the full year were down 21 per cent to $4.4 billion after a brutal year for the industry, during which spending on computers and IT systems fell.

Stacy Smith, Intel's chief financial officer, said sales and profits this year would be driven by a rise in consumer and business spending as households and firms switch to the Windows7 system from Microsoft.

But Graham Palmer, head of Intel in Britain, said the country was lagging. "In Europe and the UK, the fourth quarter was a little behind a normal seasonal pattern, while the Americas and Asia were ahead," he said.

"Europe still has a little way to go to catch up and the UK mirrors this. We are still not seeing behaviour return to the levels we would like to see.

"Budgets are tight but the technology we are putting into the market allows businesses and the public sector to improve efficiency and reduce costs."