Intel shares tumble after the company forecast first-quarter 2026 revenue and profit below Wall Street expectations and said it cannot fully meet demand for server processors used in AI data centers. The stock drop came even as Intel reported fourth-quarter 2025 results that beat expectations, shifting investor attention back to near-term supply limits and higher costs tied to manufacturing transitions.
The selloff was sharp, with Intel shares falling about 13% in after-hours trading on Thursday, Jan. 22, and also down 13% in premarket trading on Friday, Jan. 23. The move disappointed investors who have been watching Intel’s turnaround under CEO Lip-Bu Tan and looking for signs the company can convert stronger demand into improved financial results.
Weak Q1 outlook drives selloff
Intel told investors it expects first-quarter 2026 revenue of $11.7 billion to $12.7 billion, below the $12.51 billion analyst average estimate cited in the report. The company also projected adjusted earnings per share at break-even, compared with analysts’ expectation of a 5-cent profit.
News coverage of the guidance highlighted that the drop followed quarterly profit and revenue forecasts that came in below estimates. If the premarket decline were to hold, it would erase about $31 billion from Intel’s market value, according to the report.
AI data-center demand exceeds supply
Intel’s leadership said the company was caught off guard by a surge in demand for server CPUs used in AI clusters, where traditional processors are paired with AI accelerators. Executives said Intel is running fabrication plants at high utilization but still lacks enough supply to fully meet orders in the near term.
CEO Lip-Bu Tan told analysts he is “disappointed” the company cannot fully meet demand in its markets in the short term. CFO David Zinsner said demand surprised even cloud providers and noted customers had to upgrade older chip fleets after what he described as an “erosion in networking performance.”
Newsmax also reported that Intel warned a spike in memory chip prices could weigh on PC-market sales. Zinsner said he expected available memory supply to improve in the second quarter after hitting its lowest levels in the first quarter, according to the same report.
Panther Lake ships as 18A ramps
Intel said it has begun shipping Panther Lake PC chips, which it described as the first product manufactured on its key 18A process technology. The company positioned 18A as central to its plan to regain manufacturing competitiveness.
The report said early 18A production yields were initially low, while Intel said yields are improving month by month. Tan told analysts that 18A yields are in line with internal plans but remain below the level he wants.
Foundry roadmap and 14A decision
Intel provided an update on its future foundry roadmap, saying it has held back major investment in its next-generation 14A process while it waits for a large external customer. Tan said two customers are evaluating the technical details of 14A, and Intel expects to know by the second half of 2026 whether external customers intend to proceed toward test chips.
Some market observers framed the situation as a near-term capacity and product-mix challenge, even with improved demand conditions. Bernstein analysts said “the server cycle seems real,” but argued Intel “woefully misjudged” it and was “massively caught off guard” on capacity, according to the report. Jefferies analysts said the server market “does sound better overall,” while also pointing to Intel’s lower cloud share versus AMD and ongoing product issues, according to Newsmax’s account.
The pullback followed a period of strong gains in Intel’s stock, with Newsmax reporting the shares rose 84% last year and were up 47% in January 2026 before the selloff. Even with renewed interest tied to stronger server-chip demand, the company’s latest outlook and supply constraints have become a fresh test for investor confidence in Intel’s turnaround plan.
