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Intel said today that the record $1.45 billion fine imposed on it by the European Commission for violating antitrust rules, will not force it to reduce investment or cut its dividend.

"There's still plenty of cash flow from operations to invest in our business, pay the fine and pay the dividend," Chief Financial Officer Stacy Smith said at an analyst event in London on Wednesday.

"As we've said in the Q1 earnings call, we are not having any conversations about cutting the dividend."

Stacy J. Smith

Intel told analysts that cannibalization of laptop computer sales by lower priced netbooks was currently about 20 percent. Twenty percent cannibalization would mean that 20 percent of netbooks sold would have been sales of full notebooks.  

"There's great concern about the potential of the Atom mix because it's a lower selling price product, but it's also a lower cost product," Smith said.  

"And that cost really enables us to ramp it without having an adverse effect on the overall product margin of the business."  

Smith said the current economic crisis was following the pattern of previous slowdowns, but that Intel reacted quickly to reduce capacity as sales slowed and inventory increased in the fourth quarter.  

"We brought down the loadings in our factories dramatically to below 40 percent," he said. "Pretty much in one quarter we were able to get inventory back to a healthy level."  

"The inventory levels overall through the worldwide supply chain now are at a healthy, even a little bit lean, level."