Intel shares plunge as chipmaker suffers manufacturing woes, inventory shortages | Latest Tech News
Intel shares plunged by as a lot as 17% on Friday after the chipmaker admitted it was struggling to meet demand for its high-powered AI chips.
The Santa Clara, Calif.-based firm, which makes chips needed for data facilities, is in the midst of a turnaround effort as it appears to capitalize on surging demand from tech giants who need chips and servers to energy the artificial intelligence increase.
During a call with traders, Intel executives, including chief financial officer David Zinser, admitted that provides had ran in half because they underestimated demand.
FILE PHOTO: A smartphone with an Intel emblem displayed is positioned on a pc motherboard in this illustration created on March 6, 2023. REUTERS/Dado Ruvic/Illustration/File Photo REUTERS
ZInser said he expects shortages would continue in the first quarter but ought to start to improve by mid-year.
“The server cycle seems real, but the company appears to have woefully misjudged it with its capacity footprint caught massively off guard,” Bernstein analysts said in a notice.
In the fourth quarter, Intel reported a internet loss of $333 million, worse than Wall Street had anticipated.
The company initiatives a loss of 21 cents per share in the first quarter as it ramps up spending to deal with the shortfall.
The dismal outcomes marked a major setback for Intel, whose shares had surged 84% last yr, pushed in half by investor optimism over major investments by the US authorities, investment giant SoftBank and Nvidia.
Intel has struggled with low manufacturing yields, which refers to the quantity of viable chips produced at its plants.
FILE PHOTO: An Intel emblem seems in this illustration created on August 25, 2025. REUTERS/Dado Ruvic/Illustration/File Photo REUTERS
Intel CEO Lip-Bu Tan said the company was “working tirelessly to drive efficiency and more output” and was on what he described as a “multiyear journey” to enhance manufacturing.
“While yields are in line with our internal plans, they are still below what I want them to be,” Tan said during a convention call on Thursday. “Accelerating yield improvement will be important lever in 2026 as we look to better support our customers.”
With Post wires
Stay informed with the latest in tech! Our web site is your trusted source for breakthroughs in artificial intelligence, gadget launches, software program updates, cybersecurity, and digital innovation.
For contemporary insights, skilled coverage, and trending tech updates, go to us frequently by clicking right here.
