Intel shares slide 22% as weaker PC outlook pressures turnaround

Intel shares dropped 22% after the company projected PC chip sales below expectations and said margins would fall, according to the Financial Times. The forecast points to weaker near-term demand in a core business and less operating leverage as the company pursues its turnaround.

Intel's most recent full-year figures showed revenue of $52.9B, down 0.5% year over year, with a 34.8% gross margin and a negative 0.5% net margin. The new outlook therefore changes the near-term frame from a company trying to stabilize its base to one facing additional pressure on both sales and profitability.

The direct exposure is Intel's PC chip business: lower unit demand or pricing would reduce revenue, while falling margins would compress the earnings contribution from those sales. The company's annual results also show the connection between revenue performance and profitability, with diluted EPS at $-0.06 for the year.

The precise size and timing of the forecast shortfall, along with the drivers of the margin decline, remain the key unresolved details. The share-price reaction reflects the reported outlook, but it does not by itself establish whether the weakness is temporary or a broader setback to the turnaround.

The next test is Intel's next reported results and updated guidance. Investors will need the PC sales trajectory, gross-margin progression and earnings outlook to determine whether the forecast marks a single-quarter reset or a more persistent deterioration.