Intel's Q2 2025 Net Loss Widens 81% Year-Over-Year Amid Restructuring Costs, Revenue Outperforms Estimates

Intel reported a wider-than-expected net loss in Q2 2025 amid restructuring costs, yet revenue outperformed estimates and cash reserves grew. The chipmaker’s stock fell 11% in the week following the earnings release, trading at $20.71 per share, below its 52-week average of $21.78. The company recorded a non-GAAP earnings loss of $0.10 per share and a GAAP net loss of $2.9 billion, marking an 81% year-over-year decline in profitability compared to the $1.6 billion loss in Q2 2024. The GAAP loss widened from -$0.38 to -$0.67 per share, largely due to a $1.9 billion restructuring charge tied to workforce reductions and operational shifts under new CEO Lip-Bu Tan [1].

Despite the loss, Intel’s revenue of $12.86 billion exceeded the LSEG consensus of $11.92 billion, reflecting resilience in a competitive market. Non-GAAP earnings would have been $0.10 per share without restructuring costs, beating the $0.01 estimate. The company reduced its workforce by approximately 15% in line with Tan’s strategic focus on core business operations and the development of its 18A (1.8nm) chip technology. This restructuring lowered GAAP EPS by $0.45 per share [1].

Intel’s cash balance grew to $9.64 billion in Q2, a 16.7% increase from the prior year, driven by $922 million in proceeds from Mobileye share sales. Total liabilities fell by 2% to $34.96 billion, and operating cash flow remained stable at $2.1 billion. However, the company’s gross margin declined from 35.4% in Q2 2024 to 27.5% (GAAP), reflecting rising production costs. Intel anticipates a rebound, forecasting a 34.1% gross margin in Q3 as 18A chip production ramps up in Arizona [1].

Looking ahead, Intel’s revenue guidance for Q3 is $12.6 billion to $13.6 billion, with GAAP EPS expected to improve to -$0.24 from -$0.38 in Q2. The company aims to regain market traction with Panther Lake processors launching in late 2025, addressing reliability issues that plagued its Raptor Lake series. However, challenges persist in the GPU segment, where Intel’s 2nd-gen Battlemage GPUs (B570 and B580) hold less than 1% market share against Nvidia’s 92% and AMD’s 8% in Q1 2025 [1]. Analysts note Intel’s re-entry into the GPU market is complicated by entrenched competitors and the need to catch up on standards like DLSS and FSR.

Financial analysts project a mixed outlook for Intel. The average price target is $21.97 per share, according to WSJ forecasts, with a ceiling of $28.30 and a floor of $14. While 38 analysts recommend holding, only 2 are bullish and 4 bearish [1]. Shareholders are advised to monitor the impact of ongoing restructuring efforts and the rollout of 18A chips, which could stabilize earnings and restore confidence. For now, the stock’s 11% weekly decline suggests investors remain cautious despite improved cash reserves and revised guidance.

Source: [1] [title:Intel Q2 Earnings: Is there a Silver Lining?] [url:https://coinmarketcap.com/community/articles/6883b107cf73665c3b5f89dd/]