Intel shares plunged nearly 26% in Friday's premarket session as investors responded to disappointing fourth-quarter guidance and a wider technology sell-off. Benzinga Pro data showed Intel trading at $68.39, a decline of 25.72%, during Friday's premarket session. Nasdaq futures dropped 2.23%. S&P 500 futures lost 0.94%.
Intel reported adjusted third-quarter earnings at 52 cents per share, above the analyst consensus of 40 cents. Intel generated $16.51 billion in revenue, exceeding the $16.47 billion Wall Street estimate. Intel projected adjusted fourth-quarter earnings at 25 cents per share, versus the consensus forecast of 43 cents. Intel expects fourth-quarter revenue between $15 billion and $16 billion, below the $17.05 billion estimate. The outlook raised concerns about PC demand, increasing memory costs and whether Intel can sustain growth in data centers and foundry operations.
Intel CEO Lip-Bu Tan attributed the third-quarter performance to better execution, expanded supply and progress in process technology. Tan said CPU demand remains strong despite near-term PC market weakness. Intel is giving priority to increasing Xeon supply for strong demand while upgrading the product portfolio and roadmap. Tan said Intel aims to use these opportunities to achieve sustainable growth and deliver long-term value for shareholders.
Benchmark analyst Cody Acree characterized Intel's third quarter as solid but called the fourth-quarter forecast a substantial disappointment. Acree said on CNBC that PCs and memory-related pressures accounted for the weakness. Acree estimated that the earnings forecast missed expectations by about 20 cents per share. Acree put the revenue shortfall at nearly $2 billion. Acree said Intel depends heavily on PCs, where higher memory costs burden manufacturers and could postpone purchases. Acree expects these supply-demand difficulties to last into 2027.
However, Acree said Intel's data center business remained on course and exceeded estimates by about $500 million. Acree said the foundry business also surpassed expectations. Acree believes agentic AI could strengthen Intel's CPU business by increasing demand for processors that support AI workloads. Acree noted greater customer engagement with Intel's 14A manufacturing process. Acree suggested Intel could eventually become a significant competitor to Taiwan Semiconductor Manufacturing Company.
Bernstein senior analyst Stacy Rasgon described Intel's quarterly performance as relatively solid, with revenue close to expectations and margins above estimates. However, Rasgon characterized the fourth-quarter outlook as extremely weak. Rasgon said on CNBC that Intel projected approximately $15.5 billion in revenue against Wall Street expectations of roughly $17 billion. Rasgon expects Intel's PC client business could shrink at least 20% sequentially during the fourth quarter. Rasgon said data center revenue could grow about 10% over the same period. Rasgon attributed PC weakness to memory shortages limiting system production. Rasgon also warned of a possible inventory correction because CPU shipments had exceeded underlying PC demand in recent quarters. Rasgon said memory supply problems could last through at least the first half of 2027, potentially disrupting smartphones and other consumer electronics.
Rasgon said investors are wagering on Intel's transformation over several years rather than near-term earnings. Rasgon acknowledged a stronger balance sheet and improved server demand. However, Rasgon questioned the earnings Intel could generate by expanding the third-party foundry business. Acree presented a more positive view, arguing that AI-related CPU demand and foundry progress could support a longer-term recovery despite near-term PC weakness.
Intel Stock Plunges 26% Amid Weak Q4 Guidance and Tech Sell-Off
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Summary
Intel shares fell nearly 26% in Friday’s premarket session as weak Q4 guidance and a tech sector selloff pushed the fear and greed index toward extreme fear. The company posted better-than-expected Q3 results but warned of soft PC demand and rising memory costs. CEO Lip-Bu Tan pointed to strong CPU sales and data center progress. Analysts said the Q4 outlook missed estimates, with challenges likely to extend into 2027. Traders are now shifting focus to altcoins to watch amid market volatility.
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