Suddenly, it’s not so nice.

Don’t look now, but the global economic meltdown is burning a hole in Intel’s business model. This week CEO Paul Otellini announced that last quarter’s profits tumbled 90 percent to $234 million, and reportedly told employees that he couldn’t rule out the possibility that Intel might actually lose money in the current quarter – it would be the first time that’s happened in more than 20 years. (Intel doesn’t comment on its internal communications.)

When things get this bad, investors justifiably ask whether it’s time to give the CEO the boot. The answer in Intel’s case? Not yet.

If Intel’s problems were rooted in bad management, it would be time for Otellini to go. But based on the hand he was dealt, the guy’s actually done a pretty good job. Since he took the reins as CEO, Otellini has cut about 20,000 workers from the payroll, pummeled rival Advanced Micro Devices , and invested in new forays into chips for smartphones and graphics applications. Thanks to efficiency gains on his watch, Intel makes chips twice as quickly as before, which means leaner inventory.

Not everything is going well. Intel’s flash memory business still looks iffy, its investment in wireless pioneer Clearwire just took a $1 billion writedown, and Otellini’s management team just blew sales forecasts by a mile – twice. But overall, Intel is a more tightly run ship than when Otellini took charge.

So why is Intel faring so much worse than high-profile tech companies like Apple , Microsoft and IBM ? For starters, Intel constantly spends billions of dollars on cutting-edge manufacturing facilities, an investment that normally pays off but looks like a burden during tough times. These factories are a part of Intel’s DNA, the lifeblood of the PC industry, and they can’t just be shut down during a recession. Yes, Intel could build them more slowly, but that would risk leaving an opening for competitors to leap ahead when the economy improves.

Intel’s business is different from the other tech bellwethers in some other key ways. When it comes to PCs, Apple caters to a niche at the high end of the consumer business, while Intel serves pretty much the whole market – so though Apple’s upstart Mac business can swim against the tide, the Intel juggernaut can’t. Microsoft’s PC-related businesses are suffering too, but the software maker’s results don’t look as bad as Intel’s because its costs are inherently lower.

IBM is a different story. Big Blue doesn’t have much skin in the declining PC game at all anymore; its admirable results are instead fueled by software sales and I.T. outsourcing contracts. It’s probably fairer to measure Intel next to folks like AMD and Seagate , which are doing much worse. (Not surprisingly, both AMD and Seagate recently got new CEOs.)

None of this means Otellini is off the hook. Apple, Microsoft and IBM are all better diversified than Intel, a problem he must address pronto. (Today, Intel has too many eggs in the PC basket; it needs to grow its new Atom chip into a solution for phones.) He probably can’t keep throwing cash at Clearwire and the flash business unless they start making money. And he will certainly have to regain Wall Street’s trust after wildly misjudging the severity of this economic crisis.

But Otellini should get a shot at pulling things together. You can’t tell by the stock price, but he’s done some good stuff.