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INTEL NOW EXPECTS fourth-quarter revenue to come in between $6.8 billion and $7.0 billion, due to increased sales of its processors, the company said in a release Thursday. However, the company does not see the increase as evidence of a major rebound in PC spending, and corporate spending remains slow, an Intel executive said in a conference call following the announcement.

The guidance compares to previous fourth-quarter revenue expectations of $6.5 billion to $6.9 billion provided during Intel's third-quarter results conference call. Intel credited higher sales of processors in Asia as a reason behind the updated revenue guidance in Thursday's press release.

Several major desktop and notebook manufacturers are located in Asia, which accounts for some of the growth in processor sales to that region. But end users in Asia, including in Japan, also are purchasing more Intel-based systems, said Andy Bryant, Intel's chief financial officer, during the conference call.

Demand in the U.S. and Europe has met usual seasonal expectations, Bryant said. Intel had forecast demand on the low end of seasonal expectations when it presented its third-quarter results in October because of concerns that consumers couldn't afford to keep buying PCs at their current pace, Bryant said. However, that demand has matched normal seasonal expectations, he said.

At the same time, "there's no major lift-off that we can tell," Bryant said.

Before the updated guidance was announced, the consensus of estimates by analysts who were polled by Thomson Financial/First Call had Intel posting $6.74 billion in revenue.

Fourth-quarter sales of flash memory and communications processors have reflected the company's overall expectations going into the quarter, Bryant said.

Intel recently introduced its fastest desktop processor yet, the 3.06GHz Pentium 4 processor. The company also introduced Xeon server processors in the fourth quarter that featured larger caches.

The company said its gross margins will be around 49 percent, at the high end of its previous guidance. In addition, Intel expects to lose about $40 million more on its equity investments than it previously anticipated due to higher impairment charges, for a total net loss of $90 million on equity investments.

Advanced Micro Devices also increased guidance for its fourth-quarter revenue Thursday, predicting a 35 percent increase in fourth-quarter revenue over the third-quarter results. Analysts aren't sure if the news from Intel and AMD means the PC market is finally starting to rebound or if the increased growth is just the result of seasonal trends. By Tom Krazit