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

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.

The Intel CEO also said the company has decided against proceeding with manufacturing projects in Germany and Poland. It also seeks to consolidate its assembly and test operations in Costa Rica into larger existing sites in Vietnam and Malaysia and further slow the pace of construction in Ohio to ensure spending is aligned with market demand.

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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