US chip giant Intel Corp. on Tuesday reported a decline in profits, reflecting the shift by consumers to newer mobile devices, but managed to beat lowered expectations.

The California semiconductor maker said third quarter profits fell 14 percent from the same period a year ago to $2.97 billion on revenues of $13.5 billion, down five percent.

"Our third-quarter results reflected a continuing tough economic environment," said Paul Otellini, Intel president and chief executive.

"The world of computing is in the midst of a period of breakthrough innovation and creativity. As we look to the fourth quarter, we're pleased with the continued progress in ultrabooks and phones and excited about the range of Intel-based tablets coming to market."

Profit amounted to 58 cents a share, or eight cents better than Wall Street expectations. Revenues were slightly above estimates as well.

Intel is betting on ultrabooks -- the thin laptop computers aimed at people seeking mobile PCs -- and new chips for tablets and mobile phones to keep up with the rapid shift to mobile devices.

The company stunned the tech sector last month by sharply cutting its revenue outlook for the current quarter, citing weak demand for personal computers and slower growth from emerging economies.

The world's largest chipmaker is being hit by a shift away from traditional PCs to mobile devices, and by a sluggish global economy. It also is hurt by consumers holding back on purchases ahead of the release in late October of the Windows 8 operating system.