Shares of


(INTC) - Get Report

fell sharply Friday after the world's biggest chipmaker disclosed that it had reduced its fiscal first-quarter earnings by a penny a share and lowered its sales by $28 million because it had to recall a defective chipset.

Earlier this month, Intel

offered to replace roughly one million motherboards, or main computer circuit boards, that had memory problems. "It will be a while before we can actually estimate what the replacement rate will be," said Intel spokesman Tom Waldrop.

The first-quarter profit revision, which was reported in a filing to the

Securities and Exchange Commission

earlier this week, did not include the potential impact of replacing the motherboards to end-users.

Santa Clara, Calif.-based Intel said in the filing that first-quarter sales totaled $7.99 billion, revised down from $8.02 billion. Net income was 77 cents a share, or $2.7 billion. On April 18, the company had

reported earnings of 78 cents a share -- ahead of consensus estimates.

The disclosure put further weight on Intel's shares, which were already under pressure because of a broad market selloff. The company's stock fell 6 1/16, or 5%, to close at 117 7/8.

Intel has already said the replacement of those faulty motherboards could cost the company as much as a few hundred million dollars.