Shares of Intel (Nasdaq: INTC) opened sharply lower Thursday and remained low during the session, reflecting investors’ concern over the bearish statement issued by the management at the investor meeting. The stock was down 4% in the afternoon. The chipmaker on Wednesday had forecast flat PC chip sales for the next two years.
Intel currently expects gross margins in the 57%- 60% range through 2022, which is less than what the company recorded in 2018. The earnings forecast, $6 per share, matches the market’s projection. The company said its market-share might shrink to 28% by the end of that period.
Meanwhile, BMO Capital Markets downgraded the stock to market perform from outperform, citing the unimpressive outlook. The analyst is of the view that the company could lose market share to Advanced Micro Devices (AMD), especially once the latter’s server products start hitting the market. The analyst also slashed the price target to $50 from $68.
BMO Capital Markets downgraded the stock to market perform from outperform, citing the unimpressive outlook
Market watchers, in general, are of the view that long-term strain on margins will be harmful to the company and its stock, especially when the slowdown persists for long periods.
Intel is currently on the path of a technological transition as it faces stiff competition in the non-PC segments, and the revival process requires high investment. The existing 14-nanometer microchips are being replaced with the 10-nanometer and 7-nanometer versions as smaller chips ensure faster processor speed and higher energy-efficiency.
While reporting stronger than expected first-quarter results last week, Intel had issued full-year guidance below the consensus estimate. The tech firm seeks to overcome the situation with a stronger product portfolio and competitive pricing.
The downturn that began following Wednesday’s outlook statement continued Thursday and Intel shares traded down 4% in the afternoon. The stock lost around 14% in the past twelve months.
We’re on Flipboard! Follow us to receive the latest stock market, earnings, and financial news at your fingertips
Most Popular
Intensity Therapeutics is establishing a new field of localized cancer reduction: CEO
Intensity Therapeutics, Inc. (NASDAQ: INTS) is a clinical biotechnology company engaged in the discovery development, and commercialization of first-in-class cancer drugs that attenuate tumors with minimal side effects while training
INTU Earnings: Intuit Q1 2025 adj. profit rises on higher revenues
Financial technology company Intuit Inc. (NASDAQ: INTU) Thursday announced results for the first quarter of 2025, reporting a modest increase in adjusted earnings. The Mountain View-headquartered company’s first-quarter revenue came
Riding the AI wave, Nvidia looks set to stay on the high-growth path
After delivering strong results for the third quarter, Nvidia Corporation (NASDAQ: NVDA) this week said the launch of its new-generation Blackwell chip is on track. The company is thriving on
Comments