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Intel attributed the drop to computer makers' using their excess inventory of chips.
The company said that while orders appeared to be adhering to a normal rate for this time of year, customers were worried about increasing their inventory of chips.
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That said, growth should slow in the second half of the year, Mr Chang told analysts, because smartphone-makers have been building up their inventories of chips ahead of new-product launches and because sales of PCs and some smartphones have been weaker than expected.
While orders from customers like Cisco, EMC and Lucent Technologies are in line with expectations, inventories of chips for wireline communications gear are still too high.
A few days later Cisco's earnings were good, but since it had an inventory of computer chips of the sort that PMC-Sierra makes, the latter was dinged once more.
By the middle of last year's second quarter, inventories of unsold chips started piling up and orders started to drop, forcing Taiwan Semi and UMC to slow down expansion plans and curtail capital spending.
That is forcing Ricoh to live off its inventory of certain computer chips and connectors.
Turner was impressed by the random shuffling of chips in one's inventory and the instances of forced improvisation on the player's part.
In the age of chips and CD-ROMs you cut inventory because it depreciates so quickly.
Trouble is, an excess of chip inventory and a price war between AMD and Intel makes things look iffy for the short term.
The company, one of the world's largest suppliers of chips for mobile phones, has seen demand fall as customers trim inventories.
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