Chipmaker Intel (INTC) felt the full force of indignant market mood after investors were left unimpressed by soft Q1 2026 guidance. The stock plunged more than 11% in after-hours trading on Wall Street Thursday. The company continues to grapple with supply constraints while transitioning to new manufacturing technologies.
Intel is forecasting breakeven EPS, below market expectations of $0.05. Meanwhile, revenue was steered towards the lower end of the estimates range. The company guided for revenue of between $11.7 billion and $12.7 billion. This compares with a consensus forecast of $12.55 billion.
Pressure on production
Thin guidance overshadowed a narrow earnings beat in Q4 2025, with Intel reporting adjusted EPS of $0.15, ahead of analysts’ expectations of $0.08. Revenue rose, barely, to $13.7 billion. At least that surpassed consensus estimates of $13.41 billion.
| Intel (INTC) | Price: $48.26 | Market cap: $231bn |
Comments from CFO David Zinsner offered little comfort, saying Intel expects near-term pressure on production capacity. He added, ‘We expect our available supply to be at its lowest level in Q1 before improving in Q2 and beyond’, highlighting ongoing challenges as the company ramps up next-generation manufacturing.
Fourth-quarter revenue declined 4% year-on-year, reflecting continued weakness in Intel’s core PC-related business. Revenue from the Client Computing Group, the company’s largest segment, fell 7% from the prior year. However, this was partially offset by stronger performance in the Data Centre and AI segment. There, revenue increased 9%, underscoring growing demand for AI-related infrastructure.
Hoping for new designs ramp
CEO Lip-Bu Tan pointed to progress in advanced manufacturing as a key long-term driver. He said, ‘The introduction of our first products on Intel 18A – the most advanced process technology developed and manufactured in the US – marks an important milestone’, adding that the company is working to expand supply to meet customer demand.
| Intel consensus | Revenue | EPS |
| 2026 | $54.10bn | $0.59 |
| 2027 | $57.13bn | $1.09 |
| 2028 | $66.20bn | $1.97 |
Source: Koyfin
For the full year 2025, Intel reported adjusted EPS of $0.42, a notable improvement from a loss of $0.13 per share in 2024. This reflects cost controls and improved operating leverage. But revenue was basically flat at $52.9 billion.
Intel also highlighted the recent launch of its Intel Core Ultra Series 3 processor family, its first AI PC platform built on the Intel 18A process. The company said this is expected to power more than 200 device designs from global manufacturers.
This is a reality check for investors after a stunning H2 2025 revival. During that time, the stock surged from below $20 to close on $40 and hit four-year highs of $54 at the close yesterday.
In theory, Intel should be able to pick up the slack as major chip manufacturers TSMC and Samsung struggle to meet soaring demand. But time will tell.
For now, the question facing investors is, does is a sharp recovery in Intel earnings this year and beyond worth betting on? The 2026 PE stands at 81, falling to 24 by 2028.
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