Faltering PC sales force Intel to slash $1bn from sales forecasts as Windows XP upgrades dry up

PC market recovery comes to an abrupt halt as Intel warns of lower than expected first quarter sales

The recovery in PC sales appears to have faltered after Intel warned investors of a $1bn revenue shortfall in the first quarter, which it attributed to lower than expected sales of business PCs.

Intel had earlier forecast sales of $13.7bn in the current quarter, but has cut its guidance to $12.8bn.

"The change in revenue outlook is a result of weaker than expected demand for business desktop PCs and lower than expected inventory levels across the PC supply chain. The company believes the changes to demand and inventory patterns are caused by lower than expected Windows XP refresh in small and medium business and increasingly challenging macroeconomic and currency conditions, particularly in Europe," explained the company in its warning to investors.

PC sales have struggled for almost four years, with Windows 8 doing nothing to re-invigorate interest in desktop PCs and laptops.

Buyers, though, may be holding off purchasing until the launch of Windows 10 in the autumn, which will coincide with the release of Intel's next-generation microprocessors. These will be produced in Intel's 14-nanometre process technology foundries, and ought to be capable of better performance and lower power consumption.

There is also a slew of other technologies and features that will be rolled into PCs from around the middle of the year, making it worth waiting for potential buyers.

Intel is pushing wireless charging and low-latency wireless screen sharing so that a laptop, for example, can be charged up while it displays wirelessly to a screen elsewhere. Using a wireless keyboard and mouse, the laptop could be used without even being in the same room as the user.

New PCs later this year should also support USB-C, which can power a wider range of devices connected directly to the PC. Apple was the first vendor to launch a product sporting USB-C when it released its latest laptop earlier this week. DisplayPort Adaptive Sync should improve graphics displays for gamers and high-end workstations, by matching the refresh rate of the monitor with the rendering rate of the graphics card.

Intel's latest line of Skylake microprocessors will also support DDR4-standard memory, which will offer 50 per cent more bandwidth and power savings of more than one-third compared to current DDR3 memory chips, which have been standard since 2009. Hard-disk bottlenecks will be addressed by a shift from SATA-3, which has been standard since around 2010, to SATA Express, increasing data transfer speeds from 6Gbps to 2GBps.

In addition to faster basic transfer speeds, it should also improve the performance of hybrid disk-drives, which combine a solid-state disk that caches frequently accessed data, with a conventional disk, which offers higher capacity at lower cost.