Industry heavyweights Intel and Microsoft both announced quarterly earnings today, both serving as harsh indicators of the economy for technology companies.

Intel’s net income for the fourth was nearly wiped out. Profit was $2.3 billion a year ago and $2 billion in the third quarter, but now is just $234 million. Revenue also fell sharply, from $10.7 billion a year ago and $10.2 billion in the third quarter to just $2 billion this quarter.

CEO Paul Otellini gave a blunt assessment of his company and the industry. “The economy and the industry are in the process of resetting to a new baseline from which growth will resume,” he said.

Intel’s bad luck also may impact mobile WiMAX specialist Clearwire, of which Intel is a major investor. Intel’s results included a $1 billion negative impact from the Clearwire value reduction, officials said.

Microsoft said its revenue was $16.63 billion for the second quarter, a 2% increase from last year. Net income was $4.17 billion, an 11% decline from last year. But the company is laying off 5,000 people in the next 18 months, with 1,400 immediately, the software giant announced.

“While we are not immune to the effects of the economy, I am confident in the strength of our product portfolio and soundness of our approach,” said Steve Ballmer, chief executive officer at Microsoft. “We will continue to manage expenses and invest in long-term opportunities to deliver value to customers and shareholders, and we will emerge an even stronger industry leader than we are today.”