Intel earnings report on Thursday, delivering better-than-expected revenue numbers. However, the company also announced significant workforce reductions, canceled manufacturing projects, and signaled broader strategic shifts that left investors cautious about the future.
Intel Earnings Report Strong Revenue, But Earnings Fall Short
The business reported revenue of $12.9 billion for the second quarter of 2025, exceeding analyst projections of $11.88 billion, according to the most recent Intel earnings report. Despite this top-line success, Intel earnings report an adjusted loss per share of $0.10, missing Wall Street expectations.
The earnings shortfall was largely due to $800 million in impairment charges related to “unidentified reusable extra equipment” and $200 million in one-time period costs. These adjustments negatively impacted the earnings per share (EPS) by about $0.20.
Key Metrics from Q2:
- Revenue: $12.9 billion (vs. $11.88B expected)
- Adjusted EPS: -$0.10 (vs. -$0.01 expected)
- Net Loss: $2.9 billion or $0.67 per share
🧑💼 Major Layoffs and Headcount Reductions
In a memo to employees, CEO Lid-Bu Tan confirmed that Intel has completed most of its planned 15% workforce reduction, aiming to bring total headcount down to 75,000 by year-end. The move is part of a broader cost-saving initiative that seeks to cut $17 billion in operating expenses by 2025.
Tan acknowledged that the past few months have been “anything but easy” and noted that these decisions were necessary to streamline operations and improve efficiency.
🏭 Factory Plans Canceled or Delayed
- The Intel earnings report also highlighted significant changes in its manufacturing strategy:
- Canceled fab projects in Germany and Poland
- Slowed construction of the high-profile chip factory in Ohio
- Consolidation of assembly and testing operations in Vietnam and Malaysia
- Wind-down of Costa Rica operations
- Tan stressed that Intel had over-invested in manufacturing without adequate demand, leading to underused and fragmented factory capacity.
- “There are no blank checks anymore. Tan wrote, “Every investment must be economically justified.”
🖥️ Mixed Performance Across Business Units
PC chips are part of Intel’s Client Computing Group (CCG), which saw a 3% year-over-year drop in revenue to $7.9 billion. In contrast, the Data Center and AI Group (DCAI) reported a 4% increase, generating $3.9 billion in revenue.
The still-developing Intel Foundry business delivered $4.4 billion in revenue (a 2% YoY growth), slightly exceeding expectations but posted a massive $3.17 billion operating loss.
Competition Heats Up
- Intel continues to face stiff competition from:
- AMD, which is gaining traction in server markets
- Qualcomm, expanding with Snapdragon X Plus and Elite chips
- NVIDIA, which dominates the AI chip market with a market cap over $4 trillion
📉 Stock Performance and Investor Sentiment
In after-hours trading, Intel’s shares closed down 4.6% after originally rising more than 2% following the company’s results release. Retail sentiment shifted sharply—Stocktwits reported a surge in message volume by over 500% and a sentiment shift from “neutral” to “extremely bullish.”
Although it had its worst-ever annual performance in 2024, dropping nearly 60%, Intel’s stock has increased 13% so far this year despite recent challenges.
🧠 Strategic Shifts and AI Focus
CEO Tan reiterated Intel earnings report focus on strengthening its core product lineup and executing its AI roadmap. He confirmed that Intel will continue to develop its 14A chip technology based on firm customer commitments, unlike previous overextensions.
In a critical move, Tan announced he would personally review and approve all chip designs before they proceed to the final tape-out stage.
“We are committed to rebuilding Intel’s competitiveness while ensuring sustainable and smart growth,” he said.
📅 Outlook for Q3 and Beyond
Intel projects Q3 revenue between $12.6 billion and $13.6 billion, with a midpoint of $13.1 billion, ahead of Wall Street’s $12.62 billion forecast. The company anticipates an adjusted Intel earnings report gross margin of 36% and break-even EPS on an adjusted basis.
Fiscal Projections:
- 2025 Operating Expense: $17 billion
- 2026 Operating Expense: $16 billion
- 2025 CapEx: $18 billion
🔍 Analyst Reactions and Price Targets
Analysts were skeptical of Intel’s ability to grow, particularly in the field of artificial intelligence. Baird analyst Tristan Gerra remarked that the company lacks compelling AI products and sees limited catalysts for revenue growth. Baird has rated the stock as ‘Neutral’ with a $20 price target.
💬 Market Buzz and Speculation
Some investors on Stocktwits speculated that Intel might be preparing for a major asset sale post-layoffs, while others hoped for analyst upgrades to reverse the share price decline.
The consensus price target for Intel earnings report remains at $21.77, indicating a potential downside of about 4% from current levels.
The latest Intel earnings report reflects a company in transition
Intel earnings report While revenue performance surprised positively, bottom-line results, large-scale layoffs, and delayed manufacturing projects point to a tough restructuring phase. Intel’s leadership under Lip-Bu Tan is clearly focused on cutting costs and regaining competitive ground in an increasingly AI-driven market.
Whether these bold moves will position Intel as a strong rival to AMD and NVIDIA remains to be seen. For now, investors appear divided—cautiously optimistic, but still looking for signs of sustainable momentum.