New York, January 26, 2026, 09:39 EST — Market open for regular trading.
- Intel shares slipped roughly 4% early Monday, deepening last week’s steep decline
- Traders remain fixated on server CPU shortages driven by AI data-center expansions
- An analyst upgrade comes amid growing doubts over near-term execution
Intel shares dropped 3.7% to $43.40 in early Monday trading, deepening a selloff that has shaved roughly 20% off the stock since late last week. Despite the recent slide, the stock remains up around 18% year to date. (StockAnalysis)
The drop is significant since Intel has been priced as a turnaround play once more, and the next phase hinges on actual product deliveries, not just pledges. The company aims to regain share in PCs and data centers, while pitching itself as a contract chip manufacturer for other companies.
This surge coincides with AI spending sparking a fresh wave of data-center construction. Intel tells investors demand is solid, but supply constraints are the bottleneck—and that pressure often hits margins fast.
Intel projected first-quarter revenue between $11.7 billion and $12.7 billion last week, with adjusted earnings expected to break even. CEO Lip-Bu Tan expressed increasing “conviction” in CPUs’ role amid the AI boom. CFO David Zinsner noted supply will hit its lowest point in Q1 before getting better in Q2. (Intel)
During the earnings call, executives highlighted robust demand for server central processing units (CPUs) that complement Nvidia’s graphics processors in many AI setups. “They were all a little bit caught off guard,” Zinsner told Reuters, referring to customer demand. Tan admitted he was “disappointed” Intel couldn’t fully keep up. “Intel’s turnaround story remains supply-constrained rather than demand-constrained,” said Michael Schulman, chief investment officer at Running Point Capital Advisors. (Reuters)
Some analysts didn’t mince words about the shift. TD Cowen argued the rally was fueled more by “the dream” than by immediate fundamentals. Bernstein said Intel was “massively off guard” by the surge in demand. Jefferies and Oppenheimer highlighted supply improvements expected in the second quarter. (Reuters)
Not everyone is pulling back. CITIC Securities upgraded Intel from “hold” to “buy,” boosting its price target sharply to $60.30 from $38.90, according to a MarketScreener roundup of analyst moves. (MarketScreener)
On a different note, Intel filed a resale prospectus supplement on Friday related to securities held by the U.S. Department of Commerce under an earlier deal. This moves the registration to a new shelf registration statement. The company stressed no new securities were issued and it won’t get any proceeds if the government decides to sell. (SEC)
Intel’s competitive challenges remain. AMD continues to push hard in both PCs and servers, while Arm-based chips are steadily nibbling at PC market share. On top of that, Intel is working to scale up its new “18A” manufacturing process, where yield—the count of good chips per wafer—is a crucial factor for profitability.
The situation could flip fast. Should Intel deliver on supply improvements in the second quarter, expect a swift valuation adjustment. On the flip side, ongoing shortages or stagnant yields would likely squeeze margins further and force another wave of estimate reductions.
U.S. stocks kicked off Monday with modest gains, driven by a broader risk-on sentiment as investors gear up for a packed slate of Big Tech earnings and a Federal Reserve policy announcement later this week. Semiconductors, known for their high beta, often mirror these shifts in market mood. (Reuters)
Wednesday brings the Fed’s decision, with the statement set for 2:00 p.m. ET and a press conference following at 2:30 p.m. ET. Traders eyeing Intel want clues—whether from channel checks, supply updates, or fresh analyst revisions—that the company’s server CPU bottleneck is loosening ahead of its second-quarter ramp. (Federalreserve)
