TLDRs;
- Intel shares drop before earnings as trade tensions spook investors.
- Foundry expansion could drive stock growth if client demand materializes.
- Tariff threats weigh on semiconductor stocks and global supply chains.
- Earnings report on Jan. 22 will influence Intel’s near-term performance.
Intel Corp (INTC) saw its stock decline 2.8% to $46.96 on Friday as investors prepared for the company’s upcoming quarterly report.
Trading volumes were robust, with roughly 127 million shares exchanging hands, signaling heightened market focus on the semiconductor giant. U.S. markets were closed on Monday for Martin Luther King Jr. Day, with trading set to resume on Tuesday. The dip comes as investors weigh the company’s operational performance against global trade uncertainties.
Foundry Expansion Drives Investor Interest
A key focus for analysts and investors is Intel’s growing contract chip manufacturing, also known as its foundry business. Intel has been investing heavily to attract third-party clients, aiming to expand its wafer fabrication services without straining cash reserves.
Analysts from Citi and KeyBanc recently adjusted their recommendations, citing the company’s potential in this segment. Citi raised its rating from “Sell” to “Neutral” with a $50 price target, while KeyBanc moved Intel to “Overweight,” projecting a $60 target. The foundry unit is now seen as a critical factor that could influence investor sentiment depending on how well Intel demonstrates demand from external clients.
Trade Tensions Weigh on Chip Sector
Macro risks have returned to the forefront, as U.S. tariff threats against multiple European countries spooked markets last week. Semiconductor stocks are particularly sensitive to such developments due to their intricate global supply chains and reliance on international equipment suppliers.
European chipmakers, including ASML, experienced declines amid concerns that new tariffs could disrupt shipments, potentially affecting U.S. companies like Intel. Market watchers note that any extension of trade threats could trigger further volatility, especially in the lead-up to Intel’s earnings release.
Earnings Day Approaches
Intel is set to release its fourth-quarter and full-year 2025 results after markets close on Thursday, Jan. 22, with a management conference call scheduled at 2 p.m. PT. Investors will be closely analyzing margins, demand, and foundry performance to gauge the company’s stability in PC and server operations while funding expansion projects.
Market participants expect that even minor cautionary signals could influence short-term stock behavior, particularly in the context of existing trade and macroeconomic concerns. With heightened expectations, Intel’s earnings report will likely set the tone for the semiconductor sector in the weeks ahead.
Conclusion
Intel’s stock movements ahead of the MLK Day holiday reflect a mix of optimism and caution. While the company’s foundry expansion offers a compelling growth opportunity, broader trade risks and market volatility continue to weigh on investors’ minds.
As Wall Street reopens, all eyes will be on Intel’s earnings report and guidance, which could serve as a key indicator of the semiconductor industry’s resilience amid global uncertainty.
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