The stock is down by about nine per cent in the middle of trading because revenue and profit forecasts for the next quarter didn't hit the mark. This is the second time in a row that their shares have tanked after an earnings report.
So far, Intel is one of the worst performers on the S&P 500 this year, with its stock price falling by roughly 36 per cent throughout 2024.
Rasgon said: "We'd love to say this is as bad as it gets, but we've lost track of how many times we've been here before.” He reckons Chipzilla's in for a tough time in the short run. And looking ahead,
"And even though we reckon they're giving it their all to sort things out, it's pretty clear the company's in a real mess. It will take years to see if their hard graft pays off, and even then, success isn't guaranteed with all the execution snags and big challenges they're up against," he adds.
Rasgon is not feeling too hopeful about the stock, dropping his target price from €39.06 to €32.55. He wonders why anyone would want to buy into Chipzilla right now, given that there's not much to look forward to in the short, medium, or long term.
Baird’s Tristan Gerra thinks there are rough seas ahead for Chipzilla.
"Heads up, their profit margins might improve next year, but that's only if they can boost their sales. The problem is, we're not expecting the x86 market to grow much, and with the rise of data centres favouring GPUs, plus ARM possibly making waves in the PC world, it's not looking great," he notes, sticking to his neutral stance and a target price of €37.20.
Investors are worried that the big AI wave is about GPUs, which means less cash for Chipzilla's CPUs.
Hans Mosesmann from Rosenblatt reckons Chipzilla's in the middle of a major overhaul, both in what they're known for (CPU design and tech) and in new areas like AI.
But he thinks the time for sweet talk about AI is over on Wall Street.
Mosesmann's not mincing words – he's slapped a sell rating on the stock with a target price of €15.81
On the flip side, Ben Reitzes from Melius Research keeps the faith.
"Maybe we're bonkers, but we've got a hunch things will start looking up in the latter half of the year," he says.
He's banking on a boost in corporate PC sales and a steadier server business for Chipzilla. Plus, they might make more dough from their products.
"And here's some good news from the last quarter – they're expecting their Gaudi 3 accelerator to rake in over €465 million in the second half of this year, which suggests things could take off in 2025. No one's holding their breath for billions in AI accelerator sales from Chipzilla, but still," Reitzes points out.