San Francisco  - Computer-chip giant Intel handily beat expectations in its quarterly earnings results announced Tuesday, sending its share price sharply higher as it forecast a sales recovery.

The world's largest chipmaker actually suffered a 398-million- dollar loss because of a 1.45-billion-dollar fine from the European Union.

Without the penalty, the company would have earned 18 cents a share, more than double earlier Wall Street estimates of 8 cents a share. Revenue fell 15 per cent from a year earlier to 8.02 billion.

The company reported an increase of 12 per cent in sales compared to the previous three months, its largest sequential increase since 1988. Intel predicted sales of between 8.1 billion dollars and 8.9 billion dollars in the current quarter, much higher than previous estimates of 7.86 billion dollars.

There is "a clear expectation for a seasonally stronger second half," chief executive Paul Otellini said.

Sales in the Asia-Pacific region declined 8.2 per cent from the year-ago figure of 4.41 billion dollars but rose 21 per cent from the first quarter. Sales in the Americas fell 14 per cent from a year ago, while Europe dropped 34 per cent, the company said. (dpa)