Chip giant Intel has reported better-than-expected second quarter results, demonstrating its strongest first-to-second quarter growth since 1988 even though revenue was significantly offset by a record €1.06 billion fine from the European Union.

Excluding the fine, Intel’s net profit was approximately $1 billion for the three months to June. Even though the company’s revenue fell 15% to $8 billion on the same quarter last year, that was up 12% sequentially and ahead of estimates, leading it to issue a ‘positive’ outlook for the third quarter.

As one of two major manufacturers of computer chips worldwide, along with arch rival AMD, Intel’s results are generally regarded as a weathervane for much of the technology industry. A positive outlook from the company could be a sign that the industry is on its way out of recession.

CEO Paul Otellini said customer ordering patterns were signaling increased confidence for the second half of the year despite a recovering economic situation.

"Intel [historically] has a much stronger seasonal second half. So the fact that the second quarter is better than the first quarter clearly puts the worst behind Intel," he said, adding that the results were "encouraging news for the industry."

"From a consumption perspective, consumer purchases led the way,” he added.

The news sent the company’s stock up 7% in late trading.