Intel (NASDAQ: INTC - News) comforted Wall Street on Tuesday as it forecast a limited effect on its fourth-quarter earnings from the fallout of the credit crunch.

"Business levels are difficult to predict," said Paul Otellini, chief executive, but the world's biggest chipmaker forecast revenues of $10.1bn to $10.9bn and gross margins of 59 per cent.

The $10.5bn mid-point of revenues was below Wall Street expectations of $10.8bn, but not disastrously lower, according to analysts.

"The sense is that it's not as bad as feared," said Avi Cohen of Avian Securities.

"Everyone recognises Q4 is going to be a very tough quarter and to [forecast] a 59 per cent gross margin is a relief at this point. These are not end-of-the-world numbers."

Intel shares had fallen 6.2 per cent during the day in trepidation at its third-quarter earnings call, but rose 6.6 per cent to $16.98 in after-hours trading on the announcement.

Intel reported profits of 35 cents a share on record third-quarter revenues of $10.2bn, compared to the 34 cents and $10.3bn analyst consensus gathered by Thomson Reuters.

Mr Otellini said the company was solidly profitable, with operating income of over $3bn.

"As we look to Q4, it is hard to know what impact the financial crisis will have on end customer demand," he warned, adding that he was confident that Intel would still outpace its peers, whatever the market.

Intel is seen as a bellwether for the PC market - its chips power four out of five computers - and the global economy. Its positive results, coupled with those of IBM, pre-announced last week, represent a good start to the earnings season for the technology sector.

Intel reported average selling prices for its microprocessors were lower than in the second quarter, due to the impact of its low-cost Atom microprocessor in a new category of netbook computers.

With flash memory chips suffering weakening demand and steep price drops, Intel recorded a $250m impairment charge related to Numonyx, the Nor flash memory business it spun off in March as a joint venture with STMicroelectronics. It said it expected to record another impairment charge of around $250m in the fourth quarter, related to its flash joint venture with Micron.