Intel Shares Decline Following Disappointing Investor Update

On Thursday, Intel Corporation (NASDAQ: INTC) experienced a decline in its stock prices, dropping over 3% following an unsatisfactory investor presentation from the previous day. According to analysts at Lynx Equity Strategies, the presentation, led by the interim co-CEO who is also the Chief Financial Officer, failed to build confidence among investors.

Analysts emphasized that the CFO's confirmation of adherence to previous earnings guidance was unconvincing, raising doubts about whether the company will meet quarterly expectations. Additionally, Intel's anticipated progress in 18A node technology appears to have stalled; production increases have now been postponed from the first half to the second half of 2025.

The lack of clarity regarding external customers for the 18A node and the absence of concrete plans for the use of funds from the CHIPS Act have heightened investor concerns. Furthermore, analysts pointed out the vague statements regarding margin improvements for Intel Foundry Services (IFS) next year, coupled with the price increases at competitor TSMC, leading to a downward revision for product margin outlook, especially for Lunar Lake.

Lynx Equity Strategies' report suggested that despite visible reasons for the decline in Intel's shares, short sellers might remain cautious due to the potential for significant news, such as the appointment of a permanent CEO. Such a development could lead to a positive increase in stock prices, similar to the case of Starbucks (SBUX).

Analysts concluded by noting that the abrupt departure of former CEO Pat Gelsinger had affected company morale and relations with supply chain partners, leading to further deterioration in Intel's performance and financial metrics. Until a new CEO is announced, Intel's stock is expected to face ongoing uncertainty.