Intel Stocks Slip as it Sees Supply Strains this Year

Shares of Intel Corporation slipped on Wednesday extended trading as it faces challenges linked to persistent global supply chain problems.

The world’s largest chipmaker fell 2.79% or 1.44 points to $50.25 per share after the bell. It skidded its gain of 1.35% or 0.69 to 51.69 in the regular hours.

The firm has now traded 2.86% or 1.52 points lower since the start of the year. Its market capitalization posted at $210.22 billion with shares outstanding of 4.07 billion.

Intel CEO Patrick Gelsinger said he anticipated the constraints to insist on this year. He also mentioned that it could continue next year as the unprecedented demand for chips rises.

In line with this, the company forecasted lower Q1 earnings per share of $0.80 compared to the market expectation of $0.86.

Eventually, Intel’s gross margin estimate of 52.00% narrowly missed the former projection of 53.00%, fueling concerns.

Last quarter, the semiconductor company warned that its margin would shrink over the next few years as it invests in additional manufacturing capacity.

It announced last week that it plans to build a chip-making complex in Ohio, with production set to begin in 2025.

Intel further stated that it would invest at least $20.00 billion to get the first two factories. Its project could eventually become the world’s largest chip-making complex.

Investors now kept an eye on how fast and successful Intel ramps up those factories.

Meanwhile, the business expects its current-quarter revenue to hike $18.30 billion, above the estimated $17.62 billion.

The projected number bets on its in-house chip-making capacity to meet the strong chip demand.

Intel Q4 Results Crushes Consensus

Meanwhile, the outlook overshadowed its fourth-quarter results that have significantly beaten the consensus figures.

Accordingly, the adjusted revenue in Q4 posted at $19.05 billion, above the anticipated $18.30 billion.

Then, revenue from Intel’s higher-margin data center business increased 20.00% to $7.30 billion, a record high for that category.

At the same time, the figure surpassed the market expectation of $6.73 billion.

Consequently, its earnings per share edged up to $1.09, outpacing the analysts’ average estimate of $0.91.

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