"They came in at the high end of their revisedexpectations, thank God," said analyst Dan Niles at Lehman Bros. "The sales guidance for the fourth quarter is less than what you'D Hope for, but given how depressed the rest of us have been throughout the summer, we'll take it."

The Santa Clara, Calif.-based company said net incomebefore acquisition-related charges rose to $2.9 billion, or 41 cents a share, from $1.90 billion or 27 cents, a year ago. That was above the 38 cent-a-share consensus forecast from analysts, according to First Call/Thomson Financial.

Sales rose 19 percent to $8.73 billion from $7.33 billion,5.2 percent higher than the second quarter. That was far less than the 9 percent to 12 percent sequential revenue growth analysts were expecting before Intel issued its sales warning Sept. 21, which sent Intel stock tumbling 22 percent the next day. But the results and its guidance that fourth-quarter revenue will rise 4 percent to 8 percent from the those in the third was enough to push Intel shares slightly higher.

In after-hours trading, the stock rose to $37-1/2 onInstinet, from a regular session close of $36-3/16 on Nasdaq, where the stock rose 1/2. Intel shares have lost more than half their value in the last six weeks as investors sold shares in high-technology stocks by the bushel.

"Predictably, they are guiding up for revenues in thefourth quarter but in the context of all the negativism surrounding Intel, this will cause investors to breathe a sigh of relief tomorrow," said Drew Peck, an analyst at SG Cowen.

Intel was hampered in the quarter by lower-than-expectedgrowth in Europe, by market share gains scored by its scrappy rival Advanced Micro Devices Inc.., and the aggressiveness of Intel's own third-quarter forecast that it disclosed on its second-quarter earnings conference call.

"We had forecast a phenomenal (third quarter) and we endedup having a pretty normal one," said Intel's Chief Financial Officer Andy Bryant on a conference call. "Don'T think of Europe as not having been a good quarter, think of it being a little down and us making a very bullish projection."