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As part of a massive round of layoffs that will ultimately impact thousands of global employees, Intel (INTC) announced it would cut 529 Oregon workers effective July 15. This comes as part of an overhaul under new CEO Lip-Bu Tan, who was hired to turn around Intel’s chip business. The news caused investor spirits to soar immediately, driving Intel’s stock over 7% higher on July 8 as the market digested the expected cost savings and fresh start for operations.
The radical pivot underscores the seriousness of Intel’s challenges in catching up with rivals like Taiwan Semiconductor Manufacturing (TSM), Advanced Micro Devices (AMD), and Nvidia (NVDA) in advanced chip design and production. While broader market trends and demand for artificial intelligence keep reshaping the chip-manufacturing business, Intel’s going back to the “basics” under new management aims to spur wiser execution and restore its competitive lead.
About Intel Stock
Intel (INTC) is a leading global semiconductor company based in Santa Clara, California, with a market capitalization of around $100 billion. Intel’s legacy dates back to decades of dominance in desktop and server CPU design. Intel has, in recent years, struggled as its global competitors such as TSMC, AMD, and Nvidia overtook it in terms of technological advancement, primarily in the realm of artificial intelligence and next-generation process nodes.
INTC stock has traded in the last 52 weeks in the wider range of $17.67 to $37.16, reflecting fluctuations in the market’s confidence in its comeback story. Following the layoffs news, shares are up 9.2% over the past five days. However, they remain down more than 30% over the past year.
Another contentious issue is the valuation. Intel is changing hands at 1.94 times sales and only 0.97 times its book value. The profit margin is deep in the red at -35.32% and the return on equity is -3.15%. Intel’s lower valuation relative to peers Nvidia and Amd reasonably represents the uphill battle it faces to turn around operations.
Intel Misses on Earnings, Guides Conservatively
Intel’s Q1 2025 numbers were mixed. The company produced $12.7 billion in revenue, flat year over year, and reported $0.13 in adjusted earnings per share, down from $0.18 in the prior-year period. On a GAAP basis, Intel reported a loss per share of $0.19, wider than the $0.09 loss last year.
Looking ahead, the company guided cautiously for Q2 revenue of $11.2 billion to $12.4 billion, with EPS in the range of breakeven to a loss of $0.32 per share. CEO Lip-Bu Tan stressed the need for the company go back to the “basics.” This involves reducing management layers, eliminating non-core costs, and heavily investing in its core foundry business.
As part of this, the company intends to lower operating expenses to $17 billion in 2025 and then down to $16 billion in 2026. The company also lowered its 2025 capital expenditure target to $18 billion, down from an initial forecast of $20 billion.
What Do Analysts Expect for Intel Stock?
Analysts are divided on Intel’s rebound. Intel’s mixed outlook has its median price target at $22.55, indicating modest downward from its current price.
Most analysts are in a “wait-and-see” position with a “Hold” consensus rating.
