Intel Earnings Are Out – And Wall Street is Not Impressed

In pre-market trading Intel shares are now down 12%, which is a much deeper loss compared to where the stock traded beofre their conference call.

What went wrong?

In short, Intel’s explanation about Q1 guidance wasn’t very satisfying for Wall Street. The company essentially admitted to not forecasting the current rise in CPU demand. While there is incredible demand for CPUs thanks to growth in agentic AI workloads, Intel is out of supply.

Making matters worse, their total inventory remains at $11.6 billion. That means they have finished chips, just not ones in areas with rabid demand.

Another concerning matter is that while demand for CPUs in AI workloads is surging, their Client group could be under continued pressure this year. The explosion of prices in other components like RAM is causing computers to get more expensive, which will weigh on growth rates overall.

In short, the massive demand cycle for CPUs is happening. Unfortunately, Intel didn’t forecast it properly which leads to near-term disappointment. Whther or not the sell-off that appears poised to happen today is a buying opportunity in the long-term depends on your confidence whether Intel’s management will be able to change course and properly execute in the year ahead.

Intel shares are down about 6.5% as of 4:29 p.m. ET. Here are a few positives and negatives from today’s earnings:

Pros

• Intel did soundly beat both revenue and EPS estimates last quarter.
• The company’s Data Center AI (DCAI) group saw 9% growth, which is an acceleration from recnt quarter. The group’s revenue grew 5% overall across 2025.
• While first quarter guidance is below expectations, Intel is blaming the softness on supply issues that will resolve throughout the year.

Cons 

• Gross margins next quarter of 34.5% are well below Wall Street’s expectations of 36.5%.
• There’s no way to sugar coat it, revenue and EPS guidance for next quarter is very poor. Wall Street will be focused on the company’s explanation for this Q1 shortfall during the company’s conference call. How well CEO Lip-Bu Tan and CFO David Zinsner explain Q1’s softness will determine where shares trade tomorrow morning.
• Intel’s Client Computing Group was down 7% in Q4, a disappointing figure.

Our live blog updates will slow as there’s no new information until the company’s conference call at 5 p.m. ET. We’ll post an update after the call. To receive it, simply leave this page open and it will update with our notes from Intel’s call.

If you’re an Intel investor that’s disappointed by tonight’s after-hours reaction, keep a couple ideas in focus.

1. The stock was up more than 10% yesterday alone, so if it opens down 6% tomorrow will still be up across the past week despite issuing earnigns guidance that is pretty poor.
2. Intel was up 49% in the past month headed into today’s earnings.

One-day drops are always uncomfortable, but Intel’s stock has been on an incredible run.

As I noted earlier in this live blog, investors were intially being fairly ‘cautious’ keeping Intel to a 3-5% drop shortly after earnings. The company’s guidance miss was bad enough it would usually warrant a broader sell-off.

However, it appears that initial ‘caution’ is now giving way to more selling. Intel shares are now down about 7% after-hours.

Intel will have a chance on its conference call to change the narrative on its guidance. The company blamed supply shortages for Q1’s shortfall in its earnings release, but will be able to add more commentary.

In addition, if Intel CEO Lip-Bu Tan issues strongly bullish commentary on CPU demand in 2026 and the direction of Intel’s Foundry business, we could see shares regain ground.

The TLDR: Intel’s initial earnings release was very poor, but the company will have a chance to reduce losses with its earnings call that begins at 5 p.m. ET.

INTC | Intel Corporation Q1’26 Earnings Highlights:

• Adj. EPS: $0.15 [✅]
• Revenue: $13.7B [✅]; DOWN -4% YoY
• Adj. Gross Margin: 37.9%
• Net Income: $(0.6)B (Est. $(0.3)B) [✅]; UP n/m YoY
• Cash from Operations: $4.3B

Q1’26 Outlook:

• Revenue: $11.7B – $12.7B (Est. $12.5B)
  • Intel expects revenue to be impacted by ongoing supply shortages but anticipates improvement in supply in Q2 and beyond.
  • The company is focusing on the rapid adoption of AI technologies, which is expected to drive demand across its core markets.

Q1 Segment Performance:

• Client Computing Group (CCG) Revenue: $8.2B; DOWN -7% YoY
• Data Center and AI (DCAI) Revenue: $4.7B; UP +9% YoY
• Intel Foundry Revenue: $4.5B; UP +4% YoY
• All Other Revenue: $0.6B; DOWN -48% YoY

Other Key Q1 Metrics:

• Adj. Operating Income: $1.2B; UP +12% YoY
• Adj. Operating Expenses: $4.0B; DOWN -14% YoY
• R&D Expenses: $3.2B; DOWN -17% YoY
• Free Cash Flow: $4.3B; UP +52% YoY
• Effective Tax Rate: 198.5% (vs. 125.5% YoY)

CEO Commentary:

• Lip-Bu Tan: “Our conviction in the essential role of CPUs in the AI era continues to grow. We delivered a solid finish to the year and made progress on our journey to build a new Intel. The introduction of our first products on Intel 18A – the most advanced process technology developed and manufactured in the United States – marks an important milestone, and we’re working aggressively to grow supply to meet strong customer demand. Our priorities are clear: sharpen execution, reinvigorate engineering excellence, and fully capitalize on the vast opportunity AI presents across all of our businesses.”

CFO Commentary:

• David Zinsner: “We exceeded Q4 expectations across revenue, gross margin, and EPS even as we navigated industry-wide supply shortages. We expect our available supply to be at its lowest level in Q1 before improving in Q2 and beyond. Demand fundamentals across our core markets remain healthy as the rapid adoption of AI reinforces the importance of the x86 ecosystem as the world’s most widely deployed high-performance compute architecture.”

Intel’s Data Center group grew 9% year-over-year while its Client segment fell 7%.

The good news for Intel investors is that losses are holding between -3% and -5%. That might not sound like good news, but Intel’s guidnace was poor enough that a larger sell-off was possible. It appears investors are being a little cautious to see what the company announces on its conference call.

“Our conviction in the essential role of CPUs in the AI era continues to grow,” said Lip-Bu Tan, Intel CEO. “We delivered a solid finish to the year and made progress on our journey to build a new Intel. The introduction of our first products on Intel 18A – the most advanced process technology developed and manufactured in the United States – marks an important milestone, and we’re working aggressively to grow supply to meet strong customer demand. Our priorities are clear: sharpen execution, reinvigorate engineering excellence, and fully capitalize on the vast opportunity AI presents across all of our businesses.”

Gross margin guidance for next quarter is 34.5%, which is below Wall Street’s expectations of 36.5%.

Expect Wall Street to poke at why Q1 guidance is below expectations in both sales and margins during the company’s conference call.

The good news? EPS for last quarter came in at $.15, significantly topping estiates of $.08.

Revenue of $13.67 billion topped estimates of about $13.4 billion.

The results for last quarter look solid.

The problem is Q1 guidance, which is $11.7 billion to $12.7 billion. At the midpoint that’s below Wall Street’s estimate of $12.51 billion. 

Q1 EPS guidance is also poor. Intel is guiding to flat EPS next quarter.

Last week in 24/7 Wall St’s AI Investor Podcast, I did a deep dive into the factors that could create a CPU shortage in 2026.

If you’re looking for more details on this storyline that’s helped drive Intel shares near 52-week highs, make sure to give our recent episode a listen!

A couple key areas to watch when Intel reports:

1.) What will the company says about its Foundry prospects? Wall Street will be closely reviewing all commentary from CEO Lip-Bu Tan in this area, specifically.

2.) Will the company specifically address CPU shortages? Many analysts have predicted a large CPU shortage this year which would allow Intel to leverage significant pricing power. How much will Intel discuss this situation on their call?

3.) What will forward guidance look like? Wall Street is modeling a relatively conservative $12.55 billion in Q1 sales. Intel will likely need to beat this number by a healthy margin for shares to rise tomorrow.

The market closes in about 10 minutes and we expect Intel’s earnings to hit the newswires shortly after 4 p.m. ET.

As a reminder, the moment earnings are released we’ll begin updating this live blog with news and analysis. To receive new updates, simply stay on this page and they will post automatically. If you’re not seeing new updates, you can try refreshing the page.

As of 3:12 p.m. ET, Intel shares are down .76% before tonight’s earnings.

Overall, its a strong market day with the Nasdaq up .87%. Investors may be reducing some Intel exposure headed into earnings with the stock up 48% in the past month alone.