Why It Matters
Intel shares fell sharply after the company issued weaker-than-expected guidance, reducing the value of the U.S. government’s 10% stake by about $12 billion in one trading session.
What Happened
Intel stock dropped 29% on Friday, its worst market day since the 1970s. The decline followed guidance that pointed to continued pressure in the personal-computer market and the effects of an extended shutdown at an Intel plant in Israel.
The Israel facility was shut after an explosion that killed two workers and seriously injured a third. The shutdown affected shipments of 10-nanometer chips, and Intel expects the disruption to reduce revenue by about $600 million over two quarters.
Lip-Bu Tan, who became Intel’s chief executive in March 2025, is leading the company as it manages the production disruption and weaker PC demand. Intel expects adjusted earnings of 25 cents per share this quarter, with revenue between $15 billion and $16 billion. Analysts had expected revenue of $17.1 billion and earnings of 43 cents per share.
D.A. Davidson downgraded Intel from buy to neutral. Its analysts said, “However it is hard to justify the current multiple when weakness is so significant.”
The U.S. government owns 10% of Intel, and the value of that holding declined by about $12 billion Friday. Nvidia, which also owns a major stake in Intel, saw the value of its holdings fall by about $6 billion.
By the Numbers
29% — Intel’s Friday share-price decline
1970s — Previous period associated with Intel’s worst stock-market day
10% — U.S. government stake in Intel
$12 billion — Approximate Friday decline in the value of the government’s Intel holdings
$6 billion — Approximate decline in the value of Nvidia’s Intel holdings
150% — Intel share-price increase heading into Thursday’s earnings report this year
4% — Year-over-year decline in global PC shipments in the second quarter
25 cents — Intel’s expected adjusted earnings per share this quarter
$15 billion–$16 billion — Intel’s expected quarterly revenue
$17.1 billion — Analysts’ expected Intel revenue
43 cents — Analysts’ expected Intel earnings per share
Two — Workers killed in the Israel fab explosion
Third — Worker seriously injured in the Israel fab explosion
$600 million — Estimated lost revenue from the explosion over two quarters
Zoom Out
The decline came during a broader selloff in technology stocks. The Nasdaq Composite fell 2.9% Friday, while Nvidia shares dropped 4%, Broadcom fell more than 5%, and Qualcomm declined 11%. Alphabet shares had fallen more than 12% Thursday.
Amazon shares fell 1.4% Friday after the company reported a third-quarter miss on revenue and earnings. Amazon maintained its 2026 capital expenditure forecast of $220 billion.
Intel finance chief David Zinsner said, “We see the PC slowdown continuing at least through the first half of next year,” while global PC shipments declined 4% year over year in the second quarter.
What’s Next
Intel said it is producing its 18A chip at high volume at a new Arizona fab. The company expects its next Arizona fab to begin operations by the end of 2028, plans to announce two customers over the next two quarters, and said it is making progress on its 14A chips.