INTC Stock Today: January 22 Drops on Weak Q1 Outlook, Yield Woes
INTC stock took a sharp after-hours hit on January 22 after Intel earnings topped expectations but soft Q1 guidance spooked the market. Management guided revenue to US$11.7–$12.7 billion with breakeven EPS and flagged below-target 18A yields. Supply tightness should ease by Q2. For Canadian investors, this resets expectations around the AI-and-foundry turnaround. All figures in US dollars unless noted. We break down what changed, where AI server demand helps, and how valuations stack up.
Q1 Outlook and 18A Yield Issues
Intel guided Q1 revenue to US$11.7–$12.7 billion with breakeven EPS, citing supply shortages and below-target 18A yields, with improvement expected by Q2. That outlook overshadowed the Q4 beat and triggered the post-close slide. The update cools near-term hopes for a clean foundry ramp. See coverage for more detail from CNBC.
18A is central to Intel’s foundry push, so yield shortfalls can delay cost curves, customer wins, and margin recovery. Lower early yields mean fewer sellable chips and weaker gross margin, even if demand exists. Management’s tone suggests progress by Q2, but execution is the key catalyst. Any sustained yield gains would support the turnaround narrative and restore confidence in the roadmap.
Segment Trends: AI Strength, PC Weakness
Data Center & AI revenue rose 9% year over year, showing firm AI server demand from cloud and enterprise buyers. That aligns with elevated accelerator and CPU deployments supporting model training and inference. For Canadians, hyperscale expansion and local AI workloads sustain long-run demand, but near-term foundry and supply constraints can still mute margin leverage.
PC revenue declined, reflecting a slower refresh cycle after pandemic spikes and cautious enterprise spending. For Canadian households and SMBs, purchasing trends remain value-focused, which caps premium unit mix. The mix shift toward AI PCs could help in 2025, but Q1 commentary indicates limited uplift today. The Globe and Mail also flagged the soft guide for the quarter source.
Valuation, Ratings, and Cash Flow
TTM EPS sits at US$0.06, pushing the P/E to about 1,231 and price-to-sales to 4.82. Price-to-book is 2.29. Free cash flow per share is roughly -1.86, reflecting heavy capex as Intel builds its foundry footprint. Debt-to-equity is 0.44 and the current ratio is 1.60, giving liquidity but keeping eyes on capex efficiency and margin recovery.
Analyst views skew cautious: 6 Buy, 22 Hold, 5 Sell, with a Hold-leaning consensus of 3.00. Our grade reads B with a Hold suggestion. Forecasts remain conservative, with near-term modeled levels at US$43.08 monthly and US$46.99 quarterly. Longer-dated projections trend lower, underscoring the need for visible yield and margin traction.
Technical Picture for Canadian Traders
RSI at 61.43 signals positive momentum, while ADX at 18.57 indicates no strong trend. MACD histogram is +0.32 and CCI sits at 161, an overbought read. Williams %R at -25.38 also tilts hot. Traders may expect choppy action after the gap, with momentum prone to fade if catalysts and volume cool.
Watch US$53.08 intraday support and US$54.60 near the year high at US$54.595. ATR of 1.71 points to wide daily swings. Volume printed 158.18 million versus a 95.74 million average, confirming strong reaction. Consider staged entries, tight stops below support, and sizing for volatility while awaiting Q2 updates on yields and supply.
Final Thoughts
INTC stock sold off because the Q1 guide undercut the Q4 beat, with breakeven EPS and US$11.7–$12.7 billion revenue tied to supply tightness and below-target 18A yields. The AI engine is real as Data Center & AI rose 9%, but margins need better yields to flow through. For Canadians, the setup is clear: respect volatility, track Q2 yield commentary, and watch cash flow trends. If yields improve and supply eases, sentiment can shift. Until then, the stock trades on execution, not promises. Define levels, manage risk, and let proof points drive positioning.
FAQs
Why did INTC stock drop on January 22 after hours?
Intel guided Q1 revenue to US$11.7–$12.7 billion with breakeven EPS and flagged below-target 18A yields and supply tightness. That outlook overshadowed a Q4 beat and challenged the near-term foundry narrative, prompting a sharp after-hours move as investors recalibrated margins and timelines.
What matters most in Intel’s Q1 outlook for investors in Canada?
Two points stand out: 18A yields and supply improvement by Q2. Better yields drive cost, margins, and customer confidence. Supply relief supports shipments and mix. Together, they determine how quickly Intel converts AI demand into earnings. Canadian investors should watch Q2 updates and free cash flow trends.
How does AI server demand factor into the story now?
Data Center & AI revenue rose 9% year over year, showing firm AI server demand. That strength can support growth, but yield and supply issues limit near-term margin capture. Sustained demand plus improving yields could turn into better gross margins and cash flow later this year.
Is INTC stock a buy right now for Canadian investors?
Analysts lean Hold overall, and our grade is B with a Hold suggestion. Valuation looks rich on thin earnings, free cash flow is negative, and Q1 guidance is soft. If Q2 shows better 18A yields and supply, the risk-reward could improve. Until then, consider partial positions and defined risk.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
