Intel Faces Significant Revenue Decline Amid Struggles in Chip Market

Sara Myers

4 months ago
a close up of a computer chip with the intel core logo on it

Photo by BoliviaInteligente

Intel Corporation is poised to announce its largest quarterly revenue drop in five quarters, with Wall Street analysts projecting an 8% decline to approximately $13.02 billion. This anticipated decrease reflects ongoing challenges for the semiconductor giant as it grapples with a shrinking market share in both the data center and personal computer sectors. The announcement is expected on October 31, 2024.

CEO Pat Gelsinger is under increasing pressure from shareholders who are concerned about the company’s ability to recover from its recent setbacks. Gelsinger has been attempting to revitalize Intel’s position in the competitive chip market, particularly against rivals like AMD, which are capitalizing on the growing demand for AI-driven chips. Analysts have noted that Intel’s failure to invest in key opportunities, such as missing out on a stake in OpenAI, has exacerbated its struggles.

Hans Mosesmann, an analyst at Rosenblatt Securities, highlighted the uncertainty surrounding Intel’s future: “Can it be fixed? And who is it going to be fixed by?” This sentiment reflects broader concerns among investors regarding Gelsinger’s strategic direction for the company.

Intel’s stock has plummeted more than 50% this year, and its market value has fallen below $100 billion. The company’s foundry business is expected to report an operating loss of $2.55 billion, largely due to high production costs that have negatively impacted gross margins, projected to drop to 37.9%.

As Intel prepares for its earnings report, shareholders are eager for clarity on Gelsinger’s plans to advance the company’s manufacturing technology and regain competitiveness in a rapidly evolving industry.

For further details and quotes from industry experts, refer to the original article from Reuters here.

Sources:
[1] https://www.cnbc.com/2024/08/01/intel-intc-q2-earnings-report-2024.html
[2] https://www.intc.com/news-events/press-releases/detail/1704/intel-reports-second-quarter-2024-financial-results
[3] https://www.scmp.com/tech/big-tech/article/3284361/intel-set-sharp-drop-quarterly-revenue-us-chip-maker-struggles-bounce-back
[4] https://www.xm.com/au/research/markets/allNews/reuters/intel-set-for-big-drop-in-quarterly-revenue-as-chipmaker-struggles-to-bounce-back-53955289
[5] https://www.bnnbloomberg.ca/business/company-news/2024/08/01/intel-says-revenue-will-fall-short-of-expectations-cuts-jobs/
[6] https://www.reuters.com/technology/intel-set-big-drop-quarterly-revenue-chipmaker-struggles-bounce-back-2024-10-29/
[7] https://dig.watch/updates/intel-faces-biggest-revenue-drop-in-five-quarters
[8] https://www.techedt.com/intel-faces-sharp-revenue-decline-amid-struggles-in-the-chip-market

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