Intel stock fell around 28% on Friday, October 30, in one of the worst trading days in the chipmaker’s history. The drop came after Intel issued a fourth-quarter forecast well below what Wall Street had expected.
The sell-off also hit the US government, which owns roughly 10% of the company. According to CNBC, the slide wiped about $12 billion from the value of that stake. Meanwhile, Nvidia, which took its own large position in Intel in 2025, saw its shares slip as well. Chipmakers across the sector were caught up in the decline.
Why Intel stock dropped after earnings
Intel told investors to expect fourth-quarter revenue between $15 billion and $16 billion. Analysts had been looking for around $17 billion. The company also guided for gross margin to shrink to 37% from 43%. On top of that, it said its heavy spending means it does not expect positive cash flow in the quarter.
The weak spot is the PC business. AI companies are buying memory and other components at enormous volume, and that demand is driving up what it costs to build a computer. As a result, PC prices are rising and buyers are holding back.
Intel CEO Lip-Bu Tan addressed the problem directly on the earnings call. “Our customers began signaling a PC slowdown based on the memory prices and availability. Year-to-date system endpoint prices have increased significantly, placing additional pressure on already limited IT budgets,” he said.
For PC gamers and other consumers, Tan’s comments describe the same squeeze from the other side of the counter. Higher memory costs end up in the price of finished laptops and desktops.
Data center growth and the fab bottleneck
Intel’s data center business had a much better quarter. Revenue there grew 78% compared with the same period a year earlier. However, Intel can only push that growth so far until it adds capacity at its fabs and signs more outside customers to use them.
That foundry push puts Intel in direct competition with Taiwan Semiconductor Manufacturing Co. (TSMC), the largest contract chipmaker in the world. Intel has one new fab in Arizona up and running. The next one is not expected to come online until 2028.
What the government’s Intel stake is still worth
The Trump administration arranged the government’s 10% purchase more than a year ago, in August 2025. Nvidia followed weeks later with a $5 billion investment of its own. Both deals tied Intel’s turnaround more closely to Washington and to the biggest name in AI chips.
Even after Friday’s losses, Intel stock is still up more than 70% for the year. That keeps the government’s investment, and Nvidia’s, in profitable territory for now. Still, the shares sit well below the highs they reached over the summer.
The next test for Intel stock is the company’s fourth-quarter report. Investors will look at whether PC demand held up through the holiday season and whether the data center gains continue while the second Arizona fab remains two years out.