Intel Corp’s second-quarter report, which was shared late on Thursday, shows that the chip maker was hit hard by the lower demand for semiconductors. The company missed badly on Wall Street estimates while also slashing full-year guidance.
Intel Corp shares suffered a 10% hit in extended trading following the news, dipping to $35.34 per share compared to the $40.18 close on Thursday. The Intel stock was already 25% down year-to-date.
According to Intel’s Q2 report, the company recorded revenue of $15.32 billion versus the $17.92 billion expected. It had adjusted earnings per share of 29 cents while the estimate was 70 cents per share.
Correspondingly, Intel now sees its 2022 revenue reaching between $65 billion and $68 billion, which is a significant adjustment compared to the previously predicted $76 billion. The expected adjusted profit is now $2.30 per share, more than one-third down from the $3.60 per share the company previously forecast.
Many experts believe Intel’s troubles are the result of a pandemic slowdown that caused people to move away from their PCs. A similar sentiment was echoed in Intel Chief Executive Pat Gelsinger’s recent chat with Reuters, who also added that the company didn’t react well to this shift.
“The economic shift was harsher and drove not only consumption changes in the marketplace, but also dramatic moves in the inventory position of key customers,” Gelsinger explained. “Those effects caused a very sharp shift in the business, and we didn’t execute particularly well.”