Intel Stock Falls As Chipmaker’s Outlook Misses

Chipmaker Intel (INTC) late Thursday beat Wall Street’s targets for the fourth quarter but badly missed estimates with its forecast. Intel stock tumbled in extended trading.

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The Santa Clara, Calif.-based company earned an adjusted 54 cents a share on sales of $15.41 billion in the December quarter. Analysts polled by FactSet had expected Intel earnings of 45 cents a share on sales of $15.16 billion. In the year-earlier period, Intel earned 10 cents a share on sales of $14.04 billion.

Intel’s Q4 report marked a return to growth after eight straight quarters of declining earnings and seven straight quarters of declining sales on a year-over-year basis.

For the first quarter, Intel predicted adjusted earnings of 13 cents a share on sales of $12.7 billion. However, analysts had forecast earnings of 34 cents a share on sales of $14.24 billion for the March quarter. In the same quarter last year, Intel lost 4 cents a share on sales of $11.72 billion.

Under generally accepted accounting principles, or GAAP, Intel expects to lose 25 cents a share in the first quarter.

Intel Stock Is A Recent Breakout

In after-hours trading on the stock market today, Intel stock sank more than 8% to 45.52. During the regular session Thursday, Intel stock rose 0.9% to close at 49.55.

On Nov. 15, Intel stock broke out of a nine-week consolidation pattern at a buy point of 40.07, according to IBD MarketSmith charts.

A resurgent PC business drove Intel’s better-than-expected Q4 results. The company’s Client Computing Group reported a 33% increase in revenue to $8.8 billion.

Intel’s overall revenue rose 10% year over year, with data center and networking chip declines offsetting the PC chip gains.

Intel’s Data Center and AI unit saw sales decline 10% to $4 billion in the fourth quarter. The company’s Network and Edge business reported a 24% decrease in sales to $1.5 billion.

Before the market open, Intel announced a foundry collaboration with contract chipmaker United Microelectronics (UMC). The two companies will collaborate on the development of a 12-nanometer semiconductor process platform to address high-growth markets at mature nodes. Those markets include mobile, communication infrastructure and networking.

Last September, Intel announced an agreement with contract chipmaker Tower Semiconductor (TSEM). Under that deal, Intel will provide foundry services and 300-millimeter-wafer manufacturing capacity to help Tower serve its customers globally.

Chip Stocks On The Move

Other semiconductor stocks reacting to earnings news Thursday included Intel spinoff Mobileye Global (MBLY) and European chipmaker STMicroelectronics (STM). Both firms reported Q4 results before the market open Thursday.

Mobileye delivered fourth-quarter numbers in line with its preliminary results provided on Jan. 4. However, its sales forecast for 2024 of $1.9 billion was below estimates for $1.98 billion.

The maker of autonomous-driving and driver-assistance technologies earned an adjusted 28 cents a share on sales of $637 million in the December quarter. On a year-over-year basis, Mobileye earnings rose 4% as sales increased 13%.

STMicro posted better-than-expected Q4 earnings on roughly in-line sales. However, its guidance was soft. The automotive and industrial chipmaker earned $1.14 a share on sales of $4.28 billion in the December quarter. Year over year, its earnings decreased 14% while sales dropped 3%.

For the first quarter, STMicro predicted sales of $3.6 billion, missing the consensus target of $4.08 billion.

On Thursday, Mobileye stock rose 1.2% to 27.95, while STMicro shares declined 0.8% to 45.60.

Intel Stock Has Mediocre Composite Rating

Intel stock ranks 10th out of 32 stocks in IBD’s semiconductor manufacturing industry group, according to IBD Stock Checkup. It has a mediocre IBD Composite Rating of 65 out of 99.

STMicro ranks seventh in the chipmaker group with a Composite Rating of 74.

Meanwhile, Mobileye ranks No. 16 in IBD’s fabless semiconductor industry group. It has a Composite Rating of 63.

Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.


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