Intel stock plunges 6% after weak Q1 revenue and profit guidance, $600M quarterly loss
Intel shares fell about 6% in after-hours trading after the company issued weak Q1 guidance despite beating Q4 estimates. Intel reported Q4 adjusted EPS of $0.15 (vs. $0.08 expected) and revenue of $13.7B (vs. $13.4B expected), but forecast Q1 revenue of $11.7B–$12.7B and breakeven adjusted EPS—below analyst expectations of $0.05 EPS on $12.51B sales. The company recorded a $600M net loss (‑$0.12/share) for the quarter, up from a $100M loss year‑over‑year. Foundry growth disappointed: the foundry unit generated $4.5B (including internal chips) but has not yet secured major external customers for its 18A/14A nodes. Intel CFO said external foundry clients for 14A are expected in H2 2026. Data Center & AI revenue rose 9% to $4.7B, while Client Computing revenue fell 7% to $8.2B. Nvidia completed a $5B stock purchase in the quarter, becoming a major shareholder. Market reaction: broader indices rose, but Intel lagged. Key takeaways for traders: weaker-than-expected Q1 guidance and lack of external foundry clients increase downside risk for INTC in the near term; AI/server strength offsets some weakness but may not be sufficient to sustain the recent rally that lifted Intel ~147% over the past year.
Bearish
The news is categorized as bearish for traders. Key reasons: 1) Guidance miss — Intel’s Q1 revenue and EPS guidance fell short of analyst expectations, which directly pressured the stock (6% after-hours drop). Guidance-driven sell-offs typically trigger near-term volatility and downward price pressure. 2) Operational risk — a $600M quarterly net loss and stalled foundry external client traction weaken the company’s growth narrative; the awaited external adoption of 18A/14A nodes remains uncertain and likely delays material revenue upside. 3) Mixed fundamentals — Data Center & AI growth (+9%) is positive, but declines in Client Computing (-7%) and combined foundry uncertainty reduce confidence that AI strength alone will sustain valuations. 4) Market dynamics — even with broader market gains, Intel underperformed, suggesting company-specific concerns dominate. Historical parallels: tech names have suffered extended pullbacks after guidance-driven disappointments (e.g., prior semiconductor guidance misses from peers led to multi-week declines). Short-term impact: elevated volatility and increased selling pressure on INTC; traders may reduce exposure, widen stops, or short on failed rebounds. Long-term impact: if Intel secures external foundry clients in H2 2026 and ramps 14A/18A volumes, sentiment could recover; until then, structural execution risk and capital expenditure needs may keep valuation subdued. Overall, expect near-term bearishness with a conditional recovery tied to concrete foundry customer wins and consistent margin improvement.