Intel Confirms Spot Shortages of Chips

Intel Corp. confirmed there have been spot shortages of some of its more affordable processors, causing a shortage of cheap personal computers for corporate users. Computer dealers and distributors are reporting scant supply of PCs with 266-megahertz and 300MHz Pentium II chips. Intel is pushing its top-of-the-line processors while demand from corporate buyers for cheaper PCs is picking up. “They are attempting to kill off” the low-end Pentium II chips, said analyst Kelly Henry of International Data Corp. “It makes perfect sense that they would be making fewer.” Intel spokesman Tom Waldrop said the shortages are temporary but declined to say which chips are in short supply. “We are working on increasing processor production,” he said. “We expect supply to be tight until late this quarter.” Shares of Santa Clara-based Intel closed at $85.63, up $1.06, on Nasdaq.