Intel’s stock took a dramatic 30% dive on Friday, marking its largest single-day drop since 1982. This sharp decline followed the release of the company’s latest earnings report, which revealed a 1% decrease in quarterly revenue to $12.83 billion, missing analyst expectations of $12.94 billion. The announcement of significant job cuts further fueled the sell-off.
Intel attributed its poor performance to unexpected market trends, despite achieving key product milestones. The company also lowered its revenue forecast for the current quarter to between $12.5 billion and $13.5 billion, falling short of analyst predictions of $14.35 billion.
Intel CEO Pat Gelsinger stated, “Our Q2 financial performance was disappointing, even as we hit key product and process technology milestones. Second-half trends are more challenging than we previously expected, and we are leveraging our new operating model to take decisive actions that will improve operating and capital efficiencies.”
In response to these challenges, Intel plans to restructure and cut operating expenses by over $10 billion next year as part of a cost-saving initiative. Executives believe these measures will pave the way for long-term success.
Intel’s disappointing earnings sent shockwaves through the global semiconductor industry. Tokyo Electron’s 12% drop in Japan led to the Nikkei Stock Average’s worst day since 2020. Other companies like ASML in the Netherlands and Nvidia also faced significant losses, with shares falling over 8% and 7%, respectively.
Gelsinger acknowledged the slowing market conditions during a call with investors on Thursday but emphasized Intel’s ability to adjust its capital spending based on market fluctuations.
