SANTA CLARA, Calif. ( TheStreet) -- Intel ( INTC) crushed analysts' earnings estimates last Thursday as the chipmaker reported higher-than-expected revenue. The stock, perversely and bafflingly, fell 3.2% the next day.

Analysts explained the share-price decline this way: Intel may have reached peak profitability, and the only way forward is down. Still, such a prospect in the infancy of an economic recovery after the deepest recession in eight decades is a difficult thesis to accept. (Fourth-quarter net income increased more than ninefold to $2.28 billion from a year earlier.)

The semiconductor industry is cyclical -- it follows the ups and downs of the economy -- and is correlated to the stock market. So the contention that Intel has reached its zenith in earnings would require investors to believe that the biggest semiconductor producer in the world is going to stagnate as the economy begins to grow again. That would also lead investors to think that the industry as a whole will decouple from the stock market, which is improbable.

Intel, which posted the highest sales in more than in a year in the fourth quarter, said the gross margin -- the portion of sales remaining after deducting the cost of production -- was a record 65%, though the margin will slip to about 61% this year. That outlook sparked concern of peak earnings, but it's likely the comments were designed to temper expectations given uncertainty about the strength of the global rebound. Raising expectations is easier than lowering them if 2010 doesn't pan out as the company hopes.

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