Intel (INTC) Shares Slide 5.2% Premarket on Weak Outlook and Trade Concerns
April 25, 2025
Published by: Zorrox Update Team
Intel Corp. (NASDAQ: INTC) shares fell 5.2% in premarket trading on Friday, following the company's release of a disappointing second-quarter forecast and ongoing challenges related to trade tensions and strategic restructuring.
Disappointing Forecasts and Strategic Restructuring
The chipmaker reported first-quarter revenue of $12.7 billion, slightly above analyst expectations. However, its second-quarter revenue projection of $11.2 billion to $12.4 billion fell short of the anticipated $12.82 billion. Intel also forecasted a break-even adjusted earnings per share for the upcoming quarter, below the expected 6 cents per share. Financial Times+6Reuters+6The Times+6
New CEO Lip-Bu Tan, in his first earnings call, announced plans to streamline operations, including reducing management layers and cutting operating expenses to $17 billion in 2025 and $16 billion in 2026. The company also plans to reduce capital expenditures by $2 billion, aiming for $18 billion in 2025.
Trade Tensions and Market Impact
Intel's outlook has been further clouded by escalating U.S.-China trade tensions. The company cited increased tariffs as a factor contributing to higher costs and reduced demand, particularly in China, which is a significant market for Intel.
Despite these challenges, Intel's first-quarter performance showed some resilience, with revenue holding steady year-over-year and adjusted earnings per share at 13 cents, surpassing expectations.
Tips for Traders
Monitor Key Support Levels: Intel's stock is approaching critical support levels. A drop below $19 could signal further downside risk.
Watch for Trade Policy Developments: Ongoing trade negotiations between the U.S. and China could significantly impact Intel's performance. Stay informed on policy changes that may affect the semiconductor industry.
Assess Restructuring Progress: Intel's cost-cutting measures and organizational changes aim to improve efficiency. Evaluate the effectiveness of these initiatives in upcoming earnings reports.
Consider Sector Trends: Compare Intel's performance with competitors like NVIDIA and TSMC to gauge its position in the semiconductor market.
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