Intel Stock Plunges After Q2 Earnings: No Magic Formula, Says Top Investor

Intel shares fell 9% after Q2 earnings, with revenues beating estimates but EPS missing by a wide margin. CEO Lip-Bu Tan announced major changes, including suspending projects and reducing staff. A top investor, JR Research, applauds the CEO's "pragmatic approach" but notes that Intel faces a "arduous journey" to unseat Taiwan Semiconductor's leadership in the foundry business. JR maintains a Hold rating on the stock.

Intel Corporation reported its second-quarter 2025 financial results, with revenues of $12.9 billion, flat year-over-year (YoY). However, earnings (loss) per share (EPS) attributable to Intel was $(0.67), and non-GAAP EPS was $(0.10). The company attributed a significant portion of the loss to restructuring charges and impairments, totaling $2.7 billion, which impacted GAAP EPS by $(0.45) per share [1].

Intel's CEO, Lip-Bu Tan, highlighted the company's progress in improving execution and efficiency, stating, "Our operating performance demonstrates the initial progress we are making to improve our execution and drive greater efficiency" [1]. The company plans to reduce its non-GAAP operating expenses to $17 billion in 2025 and $16 billion in 2026, with gross capital expenditures of $18 billion for 2025 [1].

The company's stock price fell by 9% following the announcement, with revenues beating estimates but EPS missing by a wide margin. A top investor, JR Research, applauded the CEO's "pragmatic approach" but noted that Intel faces an "arduous journey" to unseat Taiwan Semiconductor's leadership in the foundry business. JR maintains a Hold rating on the stock [1].

Intel's third-quarter 2025 revenue is forecasted to be between $12.6 billion and $13.6 billion, with EPS attributable to Intel expected to be $(0.24) and non-GAAP EPS of $0.00 [1]. The company is taking actions to drive improved execution and efficiency, including suspending projects in Germany and Poland, consolidating assembly and test operations in Costa Rica, and slowing the pace of construction in Ohio [1].

Intel's business unit revenue trends showed mixed results, with Intel Products revenue down 1% and Intel Foundry revenue up 3% compared to the same period last year [1]. The company launched three new additions to its Intel® Xeon® 6 series of CPUs, and its 18A production wafers reached a key milestone with the start of production in Arizona [1].

Intel will hold a public webcast at 2 p.m. PDT today to discuss the results for its second quarter of 2025. The live public webcast can be accessed on Intel's Investor Relations website [1].

References:
[1] https://www.intc.com/news-events/press-releases/detail/1745/intel-reports-second-quarter-2025-financial-results