Intergraph said today its legal troubles with chip king Intel will lead to lower-than-expected second-quarter revenue. By refusing to reveal critical information about its chips, Intel slowed Intergraph's product development and sales, Intergraph said.
Sales for the second quarter ending 30 June will be about what they were in the first quarter, or US$245.8 million. Intergraph blamed a "slower than expected recovery" on Intel (INTC), which it has accused of withholding vital technical information about its chips.
"The impact was in the $35-45 million range," said Gene Wrobel, assistant treasurer at Intergraph. "Our competitors got ahead of us."
Intergraph did not specify how the lower revenue would affect its net income. Wall Street had expected the Huntsville, Alabama, company to report a loss of 17 cents a share, according to a recent analyst survey by Zacks Investment Research.
In last year's second quarter, Intergraph reported a loss of $16 million, or 33 cents a share, including a $6.1 million charge. Revenue for that quarter was $288.6 million.
Wrobel said he expects Intergraph to get back on track in the third or fourth quarter.
Intergraph's stock slipped 25 cents to $8.62 Tuesday in late Nasdaq trading. Earlier, Intergraph (INGR) traded as low as $8.19.
Intergraph sued Intel in November for alleged patent violations, claiming the chipmaker used Intergraph technology in its Pentium chips. The lawsuit also claimed that Intel retaliated by withholding vital technical documents about its upcoming chips, thereby hampering Intergraph's ability to design new workstations.
Intergraph's allegations became a central part of an antitrust lawsuit involving Intel, filed by the Federal Trade Commission earlier this month.
Intel has denied any wrongdoing. Both Intel and the FTC declined to comment on the cases Tuesday.
On 10 April, Intergraph won a court order that forced Intel to hand over the technical information. Intergraph said it will be able to ship products based on the newest Intel chips by July but said its revenues would still be affected. It takes about three months to build the motherboard and wiring around the Intel chips.
