Intel (INTC) potentially crashed technology stocks. Ahead of its earnings report, Advanced Micro Devices (AMD) posted strong results. AMD stock rallied after the report, only to fall on Thursday, down by 8.26%.
INTC stock will fare worse this morning. It will fall by 15% – 20% after canceling its dividend, cutting 15% of its workforce, reporting weak Q2 results, and issuing a disappointing outlook. The firm reported revenue of $12.83 billion and adjusted EPS of two cents. In Q3, it expects to lose 3 cents a share on revenue of $12.5 billion to $13.5 billion.
Analysts expected Intel to report revenue of around $14.4 billion in Q3. They did not foresee the company losing $10 billion annually on its Foundry business. Angry shareholders may call for a change in leadership, from the CEO to middle management.
The panic selling in INTC stock may spread to a drop in shares of Nvidia (NVDA), AMD, Arista Networks (ANET), and Super Micro Computer (SMCI). Markets may spare Apple (AAPL), whose Q3 results met expectations.
Microsoft (MSFT) and Alphabet (GOOG) may fall fractionally today. Markets may fear that investments in artificial intelligence solutions will not pay off. Chatbots on websites and in software may not offer enough return on investments. Corporate customers seeking to cut subscription fees may balk at paying for AI services.