As PC sales continue to plummet, all eyes were on top hardware manufacturer Intel as it got ready to release its first quarter financial results yesterday. Indeed, according to preliminary estimates from IHS (News - Alert), mobile PC sales saw their worst performance in over 10 years in Q1, with sales dropping sharply by 13.4 percent as compared to the final quarter of 2012.

While a drop is typical in the first quarter of the year following the peak holiday season, the information and analytics provider described this drop as "abnormally sharp." Because of this, IHS decided to downgrade its previous yearly forecast for worldwide PC shipments from an increase of 3.4 percent to "flat at best," adding that a one or two percent decline seems more likely.

“The PC Industry is facing major challenges as it struggles to find a place in the consumer’s budget amid the rising popularity of the lower-priced media tablet,” said Craig Stice, senior principal analyst for compute platforms at IHS, in a statement. “Windows 8 has yet to trigger a new PC replacement cycle. While there have been many new product introductions intended to revitalize the market, like the ultrathin mobile PCs and convertibles with touch screens, it seems consumers have yet to discover the return on investment for these higher-priced systems.”

While the PC industry is far from dead, netbooks practically are, having been effectively replaced by tablets. Netbook shipments for the year are expected to be only 3.97 million units, down 72 percent from 14.1 million units last year.

Still, despite the woes of the PC industry, Intel (News - Alert) remained at the top of the global semiconductor industry in Q4 2012, with $11.98 billion in revenue and accounting for 15.4 percent of global chip market earnings. This put Intel more than four percentage points ahead of its nearest competitor, Samsung (News - Alert).

As far as Intel's Q1 2013 figures are concerned, it seems the company will maintain this leadership as it reported $12.6 billion in revenue even in the face of the weakest PC quarter yet.

According to IHS, this has to do with Intel responding "with great agility to weakening demand for its products." This largely came in the form of the company quickly cutting down its inventories in order to avoid excessive stockpiles and to make way for a new process technology, 14-nanometer lithography.

However, IHS expects that Intel won't experience rapid growth throughout 2013, but rather "slow and steady progress."