Intel's situation might get worse before it gets better...Intel's (INTC -6.38%) CEO Pat Gelsinger said he was disappointed by the chipmaker's second-quarter results -- and he wasn't the only one. The market sanctioned the company's performance, bringing the stock down 30% in one trading session last week. In the earnings report, Intel fell short of analysts' expectations, predicted a weak period ahead, and announced a $10 billion cost-cutting plan that includes major job cuts.This comes as the company, whic ...

Signage with logo at the Silicon Valley headquarters of computer hardware manufacturer Intel, Santa ... [+] Clara, California, August 17, 2017. (Photo via Smith Collection/Gado/Getty Images).Getty ImagesIntel stock (NASDAQ: INTC) posted a weaker-than-expected set of Q2 2024 earnings last week, and provided a tough outlook for Q3, guiding revenue of $12.5 billion to $13.5 billion, well below estimates of over $14 billion, as it continues to lose market share in both the PC and server space. Following the tou ...

Core View - Intel's Q2 earnings report and guidance indicate significant challenges, including declining margins, weak revenue growth, and high capital expenditures, leading to aggressive cost-cutting measures and a shift in focus to future products like Panther Lake and Clearwater Forest [2][4][6][7] Financial Performance - Q2 revenues were in-line, but gross margin of 38.7% missed guidance by nearly 5%, resulting in EPS of $0.02 vs. guidance of $0.10 [2] - Q3 revenue guidance is flat, with gross margin guidance at 38% and a projected loss on a non-GAAP basis [2] - Data Center business (DCAI) is in serious decline, while Client Computing Group (CCG) is the only segment holding the fort [2] - Foundry business is highly inefficient, generating large losses and consuming tens of billions in capex, with competitiveness unlikely before 2026 [2] Margin Challenges - Q3 margins are under pressure due to unfavorable product mix, accelerated process moves, underutilization penalties, higher non-core business charges, and more competitive pricing [3] - Lunar Lake CPU, set for late Q3 launch, is expensive to produce due to TSMC-manufactured chiplets and integrated memory with 0% markup, further pressuring margins [3] - Intel has shifted its goal of achieving 60% margins to 2026 [3] Near-Term Guidance - Q3 guidance is weak, with modest inventory digestion in CCG and below-forecast trends in DCAI, NEX, Altera, and Mobileye [4] - Intel is expected to slip behind AMD in data center revenues in Q3, despite improved server demand [4] - Q4 revenue growth is projected at the high-end of a 0% to 5% range, with Gaudi 3 expected to contribute $500M in accelerator revenues in 2024 [4] Cost-Cutting Measures - Intel announced over 15% headcount reduction, comprehensive spending cuts, and suspension of dividends starting Q4 to reduce opex and capex [6] - The company may need to raise funds from the sale of Mobileye and Altera to de-lever its balance sheet [6] Future Prospects - Intel's hopes for recovery rest on the 18A process, with Panther Lake and Clearwater Forest products expected to launch in H2 2025 and reach high volume production by 2026 [7] - The 18A process is claimed to be comparable to TSMC's N2, but doubts remain about its competitiveness [7] - Any delays or missteps in the 18A process could lead to disastrous financial outcomes [7] Industry Context - Intel's struggles reflect its inability to adapt to the changing semiconductor industry, with a continued focus on fabs rather than product innovation [8] - The company has missed the GPU train, and its debt levels are becoming a concern, with the stock likely to face further declines [8]

FinkAvenue Investors who have read my work before on Intel (NASDAQ:INTC) will know that I started with a Sell rating; since that analysis, INTC has lost 56%. In my following and second analysis of INTC, I put out a Hold rating because I considered it fairly valued; it's lost 30% since then following awful Q2 2024 results. Now, in my third analysis of INTC, my outlook has changed considerably, and I consider INTC a Buy, with a price target of $28 in 12 months, potentially indicating a 17.5% upside. Q2 2024 F ...

Intel Corporation (NASDAQ: INTC) saw a dramatic decline in its stock price following the release of its Q2 earnings report, which fell short of expectations and revealed extensive restructuring plans. The string of disappointing announcements has prompted a wave of updates to analysts’ assessments of Intel and its future prospects, leading several leading financial firms to significantly lower their price targets for INTC stock.The stock plummeted nearly 30% on Friday, marking its most significant single-da ...

Ramping Meteor Lake has been costly, and Lunar Lake will be a drag on profits next year.Intel (INTC -26.06%) reported a net loss of $1.6 billion in the second quarter, a swing of more than $3 billion year over year in the wrong direction. The company's adjusted gross margin was 38.7%, down from the same quarter last year and a mile away from its long-term target of 60%.There are a lot of moving parts contributing to Intel's plunging bottom line, but a major component is the company's aggressive push to lead ...

Months after the federal government gave Intel $8.5 billion in grants to help bring back chipmaking to the U.S., the company said it is cutting 15% of its workforce, which translates to around 17,000 jobs.  The tech company announced the job cuts as part of a massive cost-cutting and restructuring plan. "This is an incredibly hard day for Intel as we are making some of the most consequential changes in our company’s history," Intel CEO Pat Gelsinger said in a note to employees this week. "Simply put, we mus ...

robynmac We previously covered Intel (NASDAQ:INTC) in April 2024, discussing its underwhelming Foundry prospects after the release of its new segment reporting, as the IDM 2.0 brought forth the uncertain cash burn and drag on its overall profitability. This was on top of its delayed node roadmap compared to its foundry peer, signaling Intel Foundry's uncertain prospects due to its nascency. While we were optimistic about the stock's US-made sentiments, it remained to be seen when its foundry segment wou ...

JHVEPhoto Intel: The King That It Was Once Intel Corporation (NASDAQ:INTC) investors have endured a torrid 2024 after the stock topped out in December 2023. As a result, the optimism that saw INTC outperform its semiconductor peers (SMH) (SOXX) between May and December 2023 has been completely dissolved. Based on the stock's almost 30% one-day slide yesterday (August 2), INTC revisited lows last observed in early 2013 as investors fled for the exit doors. In my previous article in June, I downgraded th ...

georgeclerk/E+ via Getty Images Sinking shipwreck. That's how you could describe Intel Corporation (NASDAQ:INTC) following the disastrous Q2 earnings report. The company has reported underwhelming performance, badly missing the analysts' expectations and issuing a weak Q3 guidance, despite hopes of turnaround starting to materialize in 2024. Following the report, Intel's stock price is set to wipe out over $30B market cap, setting it for the worst sell-off since 2000 following the suspension of its attra ...