Intel says chips for tablets, phones on the way in 2011

MARATHON, NOT SPRINT

Otellini called Intel's pursuit of the smartphone market "a marathon, not a sprint," adding that the company's second-generation Medfield chip is now being sampled by customers and should ship next year and in 2012.

"You will see smartphones from premier branded vendors in the second half of 2011 with Intel silicon inside them," Otellini said.

Stock in the world's largest maker of microprocessors rose 1.11 per cent.

Otellini also Intel has resumed share repurchases after stopping over a year ago due to the tough economy.

"I'm happy to report that Intel has been back in the market this quarter," Otellini said. "The buyback has resumed."

In November, Intel said it was boosting its quarterly dividend by 15 per cent, a move seen as a sign of confidence that the world's largest chipmaker is growing, even as the U.S. economy remains sluggish.

A resumption of Intel's share repurchases amplifies that signal, said Craig Ellis, an analyst at Caris and Company. "Shareholders will look at that and say management is putting their money where their mouth is," he said.

Intel has already started shipping its new Sandy Bridge chips, which are expected to be in notebooks on store shares early in 2011.