The Zhitong Finance App learned that after Intel (INTC.US) announced disappointing results for the third quarter of 2026, the stock price fell by more than 28% last Friday. According to financial reports, Intel's Q3 revenue increased 21% year over year to US$16.5 billion, with adjusted earnings of 52 cents per share, all higher than market expectations. The division of hot and cold business segments is obvious. The Data Center and Artificial Intelligence Division (DCAI) became the core growth engine, with Q3 revenue of US$7.318 billion, surging 78% year over year, operating profit of US$3,039 billion, and profit margin of 41.5%. The Client Computing and Physical AI Division (CCPG) related to personal computers (PCs) showed weak performance, with revenue of US$8.097 billion, down 5% year on year, and operating profit contracted at the same time.
Intel management said that demand for server CPUs is high, but supply is the biggest constraint, and the company is easing supply constraints on Xeon processors by increasing factory capacity and optimizing yield. At the same time, the company said it is expected that the PC market's slowdown will continue until at least the first half of 2027.
In terms of guidance, Intel expects fourth-quarter revenue of 15 billion to 16 billion US dollars, and adjusted earnings of 25 cents per share, all of which fell far short of expectations. The pressure on performance was partly affected by the explosion at the Israeli factory, which is expected to reduce Q4 revenue by about 300 million US dollars and gross margin by about 200 basis points. The company also raised its capital expenditure forecast for 2026 from $18 billion to $20 billion, with further increases expected in 2027.
After Intel announced its third-quarter results, Wall Street bank J.P. Morgan Chase and Bank of America Securities lowered their target price for the stock. Among them, J.P. Morgan Chase maintained a “neutral” rating for Intel, and the target price was lowered from $85 to $80; Bank of America Securities directly downgraded Intel's rating from “buy” to “neutral,” cutting the target price from 145 dollars to 100 dollars.
However, on the Seeking Alpha platform, there are still a number of analysts who have raised their ratings for Intel. Analyst Mike Zaccardi, based on technical analysis, believes that this sell-off is Intel's worst since the 1970s, but it also represents a key buying opportunity. Mike Zaccardi wrote, “Intel's stock price increase is still as high as 87% since 2026. In my opinion, the current sharp decline seems to constitute a key technical buying opportunity.” He upgraded Intel's rating from “sell” to “buy.”
Analyst Bohdan Kucheriavyi also raised Intel's rating. He pointed out that considering that the company's revenue increased by about 21% year over year and that adjusted earnings per share exceeded expectations of $0.12, its performance report “performed quite well.” However, the analyst also wrote, “The problem is that the fourth quarter's performance is expected to be significantly weaker than the third quarter.” As a result, he upgraded the stock's rating from “sell” to “hold.”
Analyst Kenio Fontes raised Intel's rating on the basis that the margin of safety improved after the stock price plummeted. Kenio “>The Asian Investor also released a similar rating increase report, believing that after Intel's stock price plummeted, its valuation “has returned to normal,” and the current stock price is 50% lower than the level of a year ago. The analyst wrote, “Intel's stock price is down about 50% from the past year's high of about $142, and its valuation has returned to a position closer to the chipmaker's historical average.”
However, Quad 7 Capital, head of the Seeking Alpha investment research team, downgraded Intel's rating from “holding” to “selling.” The agency pointed out that Intel's stock price is still at a level where “perfect expectations have been fully taken into account,” but the company's future performance has already begun to show, and its high market expectations have not been met. According to Quad 7 Capital, “With capital expenditure (CapEx) remaining high throughout the year and profitability rapidly declining in the fourth quarter, the stock's current high valuation premium is becoming increasingly difficult to sustain.”