Intel Shares Fall More Than 28% After Weak Fourth-Quarter Forecast
By Katie Tarasov · · TexaHub · Semiconductors
Intel shares fell 28.58% in Friday morning trading after the company forecast fourth-quarter revenue of $15 billion to $16 billion, below analyst estimates of about $17.1 billion, and said the PC slowdown would last at least through the first half of 2027.
Outlook Misses Estimates
Intel reported third-quarter results on October 29 and forecast fourth-quarter revenue of $15.0 billion to $16.0 billion, with non-GAAP earnings of $0.25 per share and a non-GAAP gross margin of 38%. [1]
Analysts polled by LSEG had expected fourth-quarter revenue of $17.1 billion and adjusted earnings of 43 cents per share. Intel shares fell more than 20% in extended trading after the report. [2]
In Friday morning trading on October 30, the stock was down 28.58% at $65.76. Baird analysts wrote in a client note that they continue to model share losses for Intel in both its client and data centre segments in 2027. [3]
Third-Quarter Results
Revenue for the third quarter rose 21% from a year earlier to $16.5 billion. GAAP earnings were $0.60 per share and non-GAAP earnings were $0.52 per share, against the 40 cents analysts had expected. Non-GAAP gross margin was 44.1%, and Intel generated $5.1 billion in cash from operations. [1] [2]
Data Center and AI revenue rose 78% to $7.3 billion, which CFO David Zinsner described as the unit's strongest growth in 15 years. Revenue in the Client Computing and Physical AI Group, which sells PC processors, fell 5% to $8.1 billion, and Intel Foundry revenue rose 58% to $6.7 billion. [1]
Intel said it released version 0.9 of the process design kit for its Intel 14A manufacturing technology in October and completed a $23 billion public equity offering during the quarter. [1]
PC Slowdown and Israel Fab
"We see the PC slowdown continuing at least through the first half of next year," Zinsner said. CNBC cited Counterpoint Research data showing global PC shipments fell 4% in the second quarter from a year earlier because of rising memory and other component costs. [1] [2]
Zinsner also estimated about $600 million in lost revenue over two quarters from an explosion earlier in October at Intel's fab in Israel, which killed two workers. CEO Lip-Bu Tan said the accident caused an extended shutdown affecting shipments of 10-nanometer chips, and that he was disappointed Intel had not been able to meet strong customer demand in the quarter. [2]
Tan said Intel's immediate priority was to unlock additional supply to meet demand for its Xeon server processors. He told analysts that "a couple of customers" for Intel's foundry business would be announced over the next two quarters. [1] [2]
Sources
[1] Intel Reports Third-Quarter 2026 Financial Results — Intel Corporation (SEC filing)
[2] Intel stock plunges 21% as chipmaker blames PC slowdown for weak guidance — CNBC
[3] Intel plummets over 28% as weak forecast overshadows earnings beat — Investing.com