Intel Corp. shares plummeted by approximately 13% in pre-market trading on Friday after CEO Lip-Bu Tan issued a disappointing outlook, highlighting persistent manufacturing hurdles that continue to plague the semiconductor giant.
Tan’s admission that a successful turnaround would require “time and resolve” further accelerated the stock’s decline.
Disappointing Forecast
Intel’s first quarter guidance for both revenue and earnings failed to meet Wall Street’s expectations. The company projected revenue between $11.7 billion and $12.7 billion. The midpoint of this range ($12.2 billion) fell notably below the $12.6 billion consensus predicted by analysts.
In the fourth quarter of 2025, revenue dipped 4.1% to $13.7 billion. Adjusted earnings were reported at 15 cents per share.
Manufacturing Struggles
As the leading producer of PC processors, Intel is currently battling low manufacturing yields — the ratio of functional chips produced in its plants. These technical setbacks have made it difficult for the company to fulfill its existing orders.
Tan said that while demand remains “quite strong,” the company depleted much of its inventory during the final quarter of 2025.
“We are on the multiyear journey,” the CEO said.
“Our yield and production manufacturing are not up to my standards,” Tan said. “We need to improve that.”
Intel Chief Financial Officer Dave Zinsner said that additional supplies of high-margin server chips would not be available until the end of the first quarter, as ramping up production takes several months.
The Santa Clara, California-based chipmaker cannot aggressively pivot toward the server market without risking its relationship with core PC customers, further complicating its recovery strategy.
Market Reaction
Intel stock fell as low as $46.51 in pre-market trading on Friday, a sharp drop from its Thursday close of $54.32. This volatility follows a period of significant recovery; the stock had risen roughly 152% over the last 12 months and was the top performer on the Philadelphia Stock Exchange Semiconductor Index earlier this month.
Intel’s annual revenue of $53 billion remains significantly lower than its 2021 peak of roughly $78 billion.
Its client computing division had a revenue of $8.2 billion in the fourth quarter, just missing the average forecast of $8.3 billion.
Data center sales stood at $4.7 billion, as compared with a $4.4 billion estimate. The company’s factory unit, Intel Foundry Services, generated revenue of $4.5 billion, a rise of 3.8% from a year ago.
Earlier in January, the company said that the Panther Lake design for processors was now available in devices. Tan had touted their capabilities at the CES trade show in Las Vegas.
