July 17 (Bloomberg) -- Intel Corp., the world's largest computer-chip maker, said second-quarter profit rose 44 percent after sales gained for the first time in six periods on improving demand for laptops.

Net income increased to $1.28 billion, or 22 cents a share, from $885 million, or 15 cents, a year earlier, the Santa Clara, California-based company said today in a statement distributed by Business Wire. Revenue advanced 8.4 percent to $8.68 billion, the first rise since 2005.

Sales exceeded analysts' estimates after Chief Executive Officer Paul Otellini introduced faster chips and won back orders from Advanced Micro Devices Inc. Otellini shed money-losing businesses, cut more than 10,000 jobs and accelerated product introductions to revive results after a slump last year.

``Revenue is going to ramp up dramatically in the second half of the year,'' said Graham Tanaka, president of Tanaka Capital Management in New York, which owns Intel stock. ``Investors are seeing in the end market that there is a firming in demand and that they're gaining market share.''

Intel stock rose 38 cents to $26.33 at 4 p.m. New York time in Nasdaq Stock Market trading. They had gained 30 percent this year, making them the fourth-best performer on the Dow Jones Industrial Average.

Analysts anticipated sales of $8.54 billion, according to the average of estimates in a Bloomberg survey. In April the company had predicted second-quarter sales would be between $8.2 billion and $8.8 billion.

Forecast

Intel, whose results are viewed as an indicator of demand for computers and related components, kicked off quarterly earnings announcements for the technology industry along with Yahoo! Inc. Intel's microprocessors run more than 70 percent of the world's personal computers.

The company forecast sales of $9 billion to $9.6 billion for the current quarter, compared with an average estimate of $9.3 billion.

Intel didn't have to cut prices as much as in previous quarters, allowing Otellini to wring more profit from Intel's chips as consumers snapped up notebook computers. PC demand is climbing, helped by orders in countries such as China.

Intel gained 6 percentage points of market share from Advanced Micro in the first quarter after ending 2006 with its share at an 11-year low. Advanced Micro won orders by being the first to come out with new technology.

Since then, Sunnyvale, California-based Advanced Micro was late introducing Barcelona, its latest server chip, and the processor is slower than expected, JPMorgan Chase & Co. analyst Christopher Danely in San Francisco said.

The company ``plans to steadily increase the performance of these next-generation processors,'' Advanced Micro spokesman John Taylor said in an e-mail today. ``We stand by our performance projections.''

To contact the reporter on this story: Ian King in San Francisco at ianking@bloomberg.net

Last Updated: July 17, 2007 16:20 EDT