Intel’s Stock (INTC) Drops As Revenue Beats: Earnings Miss and Guidance Disappoint

Intel's stock price (NASDAQ:INTC) is changing hands 5.5% lower than the recent close in pre-market trading, following the release of its Q2 2025 earnings report.

Despite surpassing revenue expectations, a significant earnings miss and negative guidance triggered a sell-off, highlighting concerns over the company's ongoing restructuring and profitability challenges.

The chipmaker reported Q2 revenue of $12.86 billion, exceeding forecasts. However, the company posted a loss of $0.10 per diluted share, a stark contrast to analysts' expectations of a small profit. This earnings miss is attributed primarily to restructuring charges totaling $1.9 billion, including severance costs and asset impairments related to Intel's ongoing transformation plan.

The market's reaction is understandable given the earnings shortfall. The stock had gone into the print already under a little pressure, with a 3.66% drop on the day.

CEO Lip-Bu Tan's strategic restructuring plan involves a significant workforce reduction of approximately 15%, aiming to streamline operations and reduce costs. This initiative, while intended to improve long-term efficiency, has resulted in substantial short-term expenses that weighed heavily on Q2 earnings.

The company aims to reduce its workforce from 99,500 to around 75,000 employees by the end of 2025, signaling a major shift in its operational structure.

Intel is also optimizing its manufacturing footprint by canceling planned projects and consolidating operations. This includes slowing down construction in Ohio to better align spending with market demand.

These measures are designed to enhance capital efficiency and improve returns on invested capital, but their immediate impact on financial performance remains uncertain.

Looking ahead, Intel anticipates Q3 revenue of approximately $13.1 billion, slightly above analyst forecasts of $12.59 billion. However, the company expects a loss of 24 cents per share for the quarter, is larger than that expected by Wall Street of an 18-cent loss.

This guidance suggests that profitability challenges will persist in the near term, further dampening investor sentiment.