Intel Analyst Says No ‘Meaningful Growth Drivers’ Ahead After Q2 Revenue Beat, Austerity Measures — But Retail Turns Upbeat

Intel CEO stated on the earnings call that during the second quarter, Intel completed the majority of the right-sizing actions necessary to achieve its target of 75,000 employees by the end of the year.

Intel Corp. (INTC) shares fell 4.60% in extended trading on Thursday despite the Santa Clara, California-based chipmaker reporting a quarterly beat. Investor pessimism is centered on the outlook amid the company’s job cuts and scaled-back foundry plans.

On Stocktwits, retail sentiment toward the Intel stock improved to ‘extremely bullish’ (84/100) by late Thursday, from ‘neutral’ a day ago. The message volume also increased to ‘extremely high.’

Commenting on the report, Baird analyst Tristan Gerra said, “We continue to see a lack of meaningful revenue growth drivers ahead, as Intel lacks the products to participate in AI [artificial intelligence].”

The analyst said he expects further share losses in the near term. Baird has a ‘Neutral’ rating and $20 price target for Intel stock.

Intel reported a loss of $0.10 per share and revenue of $12.9 billion for the second quarter of the fiscal year 2025. The adjusted bottom-line results included a $0.20 per share negative impact from $800 million of impairment charges and $200 million in one-time period costs.

The top line, while remaining flat year over year (YoY),  exceeded the Fiscal.ai-compiled consensus estimate of $11.88 billion.

Client Computing Group (CCG) reported 3% YoY decline in revenue, while Data Center and AI (DCAI) revenue and Intel Foundry revenues improved 4% and 3%, respectively.

“Our operating performance demonstrates the initial progress we are making to improve our execution and drive greater efficiency,” said Lip-Bu Tan, Intel CEO. The executive also said the company is laser-focused on strengthening its core product portfolio and its AI roadmap. 

Tan stated on the earnings call that during the second quarter, Intel completed the majority of the right-sizing actions necessary to achieve its target of 75,000 employees by the end of the year, according to a transcript provided by Koyfin. 

The company is on track to implement its return-to-office mandate starting September, he added.

Looking ahead, the company expects to achieve breakeven results on an adjusted basis and revenue of $12.6 billion to $13.6 billion for the third quarter, along with an adjusted gross margin of 36%. The consensus estimates call for earnings of $0.04 and revenue of $12.62 billion. 

Intel guided to an adjusted operating expenditure of $17 billion for 2025 and $16 billion for 2026, as well as capital expenditure (Capex) of $18 billion for 2025.

The 24-hour message volume on the Intel stream increased by 515%, with Stocktwits users discussing Intel’s results and its outlook.

A bullish watcher based their optimism on their view that Intel was preparing for a sale following the job cuts.

A few expected the stock to make up its after-hours losses with analysts’ upgrades.

Intel shares have gained nearly 13% year-to-date. The consensus price target of analysts is $21.77, implying a potential downside of almost 4%.

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