1. 2010 Best product lineup ever with leadership in all segments and categories Q1 Record first quarter in revenue and operating income Q1 Results Revenue $10.3bn, down 3% sequentially from $10.6bn, up 44% y/y from $7.145bn Gross margin: 63.4%, down 1.3% sequentially from 65%, up 17 point YOY from 46% Operating income: $3.4bn, up 38% sequentially from $2.5bn, up 433% YOY from $670m. Net income: $2.4bn, up 7% sequentially from $2.3bn, up 288% YOY from $647m EPS: 43 cents, up 3 cents sequentially from 40 cents, up 32 cents YOY from 11 cents. Q1 -Record first quarter in revenue and operating income due to a combination of excellent execution, the ramp of best product line-up ever with leadership in all segments coupled with incredible demand for these new products. -Particularly strong demand for higher end products. (richer mix) -Record quarter for our mobile business. -Signs of corporate demand returning. -Superb execution of 32 nm ramp – our fastest ramping process ever. New products Intel Core 2010 processors offer great opportunities for both businesses and consumers: their speed meets intelligence: they are faster, better and smarter and they drive a rich mix of demand in consumer and business. Xeon 75XX series represents the greatest performance leap for Xeon in its history (+370%) offering 20:1 consolidation of >4 year old servers. Adjacent market progress In Feb. at MWC Intel/Nokia announced MeeGo software platform which offers a universal and very rich consumer experience across pocketable mobile computers, netbooks, tablets, phones, connected TVs. Orange and Telecom Italia committed their support. Intel-based settop box (Amino Freedom) won „best consumer device 2010“ in the UK at IPTV World (powered by Intel Atom CE 4100) Success stories France: CEA Tera 100 project: 18.000 Xeon 75XX reduce time on large simulations. Education: sustained investment in education programs in: Ukraine: 110K pupil program by 2014. UK: Home access program: shipped 40K in Q1 – goal 130K in 2010. Teacher trainings: > 50K teachers trained in Macedonia, Russia, Spain Q2 Outlook Outlook for Q2 Revenue $10.2bn (plus or minus $400m) Gross margin: 64% (plus or minus a couple of percentage points) Spending (R&D plus MG&A): approximately $3.1bn * The outlook for the 2nd quarter does not include the gain expected from tue sale of our investment in Numonyx. Full Year 2010 Gross margin percentage 64% (plus or minus a couple of percentage points) Spending (R&D plus MG&A): $12.4bn, plus or minus $100m. Gross margin projections for 2010 include expectations for increase in ASP, lower units costs and higher sales volumes: Tax rate: Approximately 31% Capital spending: Expected to be $4.8bn, plus or minus $100m Basis for outlook: PSO earnings release quote: „Looking forward, we are optimistic about our business as Intel products are designed into a variety of new and exciting segments. We will see the ongoing benefits from restructuring have us positioned for profitable growth. 32nm is our fastest ramping process ever and we are pulling in the launch of our 3rd and 4th 32 nm factories.“ We are now entering into the 4th era of computing: 1st was mainframes, 2nd was the PC and the 3rd was mobile computing and the 4th era will be all about convergence of devices and a seamless personal Internet experience. Anectode: Gartner estimates that there are >330K servers shipped in 2005 (UK,Ger). These could be replaced by 17K Xeon 75XX servers – reducing energy consumption by 94%, paying for themselves in 11 months and CO2 savings of approx. 200K cars removed from the road.