(Telecompaper) Intel reported first-quarter revenue of USD 12.8 billion, up slightly from USD 12.6 billion a year earlier but 8 percent lower compared to the fourth quarter. The result was in line with the company's guidance. Its gross margin dropped to 59.7 percent from 62.0 in the previous quarter, and operating profit declined 29 percent on a sequential basis to USD 2.5 billion. Net profit totaled USD 1.9 billion or 38 cents a share, down from 2.0 billion or 40 cents a share a year ago. Intel said it saw signs of improvement in the PC market in Q1, while the data centre and tablet businesses remained strong. After shipping 5 million tablet processors in Q1, Intel said it was on track to meet its annual target of 40 million. The PC Client Group posted revenue of USD 7.9 billion in Q1, down 8 percent sequentially and down 1 percent year-over-year. Data Center Group revenue was down 5 percent sequentially bu 11 percent higher year-on-year, at USD 3.1 billion. Mobile and Communications Group revenue reached USD 156 million, down 52 percent from Q4 and 61 percent lower year-over-year. Software and services generated revenue of USD 553 million, down 6 percent sequentially but up 6 percent year-over-year.