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Processor giant intel is frequently viewed as a bellwether for the condition of the IT industry. For its third quarter, ending 1 October 2005, Intel reported a record number of units shipped and growth across all product lines bar motherboards. This drove an 18% rise in revenues, up to $9.96 billion, compared to $8.47 billion in the same quarter a year previously.

There was some concern among Wall Street analysts when Intel's CFO Andy Bryant indicated that sales had been boosted by large customers stockpiling chips in anticipation of a future shortage. But Bryant assured investors that this stockpiling would not result in a major inventory glut at the company, as it did in 2004.

With dual-processor chips and its 'hyper-threading' performance-enhancing technology finally reaching the market, Intel has closed a perceived technology gap with leading rival amd. That company also submitted a positive report for its third quarter. Revenues stood at $1.52 billion, up 23% from the year-ago quarter when revenues were $1.24 billion.

AMD was boosted by Sun Microsystems' release of its Galaxy family of servers which are built using AMD processors. It has also penned a similar deal with Fujitsu.

Mobile demand

In part, the demand for chips is being driven by developments in mobile technology. Intel, for example, recently struck a groundbreaking deal with the manufacturer of the BlackBerry, Research in Motion (RIM), for it to use Intel chips in the handheld email reading devices.

RIM itself reported a 58% increase in revenues after the second quarter of its fiscal 2006 - ending 27 August 2005. The BlackBerry device has proved to be enormously popular, but that in turn has given rise to a glut of competitors offering similar functionality. RIM is currently attempting to safeguard its position through licensing its technology to third-party mobile handset manufacturers.

Research in Motion has yet more cause for prudence in a long running patent dispute in the US. In August 2005, a court in North America ruled that elements of the Canadian company's signature device infringe upon patents held by US company NTP. In October, the US Court of Appeals refused RIM the opportunity to appeal the decision. The case, now to be re-heard in the court that originally upheld NTP's complaint, could result in a ban on RIM selling BlackBerrys in the US.

One of BlackBerry's licensees also reported a standout performance in the mobile device market: mobile phone maker nokia, which grew revenues by 18% year-on-year. For its quarter ending 30 September 2005, the Finnish company reported revenues of €8.40 billion compared to €7.10 billion in the same quarter in 2004.

Where Nokia struggled was in its mobile network equipment division, which sells network infrastructure to telecommunications carriers. In this area, the company dropped revenues by 20%. Analysts also warned that Nokia faces mounting pressure from rival companies offering highly discounted mobile phone prices.

Nokia is placing increasing strategic importance upon its Enterprise Solutions division (hence the company's inclusion into the Infoconomy Global Index - see page 51) as mobile device provision becomes a strategic imperative for corporate IT departments.

This division is still a loss making unit for the company, but increased sales of its Nokia 9300 enterprise smartphone, driven by a wider range of applications made available for the device during the year (thanks in part to deals with RIM) shrank the departmental deficit from €69 million in the third quarter of 2004 to €37 million for the same period in 2005.

Against the prevailing optimism, technology giant ibm reported relatively disappointing financial results, despite increased sales of software, hardware and services. Revenues were down from $23.40 billion in the quarter ending 30 September 2004, to $21.53 billion in the same quarter in 2005.

Part of this results from IBM selling off its PC-making business in the third quarter of 2004 - without that divestiture, IBM executives say revenues would have risen. IBM's software arm performed particularly well, with revenues from the WebSphere family of service-oriented software growing by 14%, its Tivoli infrastructure management tools by 8%, and the Lotus software range by 12%.

Elsewhere, German business applications maker sap exceeded expectations by growing revenues by 20%, up to €2.01 billion for the quarter ending 30 September 2005, compared to E1.78 billion in the 2004 quarter. Surprisingly, this growth was mainly driven by CRM software revenues, which rose by 41% over the same period in the previous year. But while CRM revenues grew, SAP also reported a downturn: a 13% drop in sales of its product lifecycle management tools.

Analysts explained SAP's success as a reaction to rival Oracle's recent acquisition spree in the ERP space. Customers see SAP as a 'known quantity', the argument runs, whereas the impact of Oracle's purchase of smaller vendors, both on those vendors' products and those of Oracle itself, has yet be seen.