Intel sinks after forecasting weaker than expected start to 2023

Investing.com -- Intel Corporation (NASDAQ:INTC) shares sank in late trading after the chip maker gave weaker than expected guidance for the current quarter as customers hold back on tech spending.

The chip maker reported fourth quarter adjusted earnings per share of 10 cents on revenue of $14 billion. Both fell short of expectations, which were for EPS of 21 cents on revenue of $14.5 billion.

Intel said it expects first quarter revenue of $10.5 billion to $11.5 billion, which is far below the $13.9 billion forecast by Wall Street. It also said it could record an adjusted loss of 15 cents a share to zero for the quarter, compared with expectations for earnings per share of 24 cents.

Intel stock fell more than 7% in after-hours trading. 

CEO Pat Gelsinger said: “In 2023, we will continue to navigate the short-term challenges while striving to meet our long-term commitments, including delivering leadership products anchored on open and secure platforms, powered by at-scale manufacturing and supercharged by our incredible team.” 

The company said fourth quarter revenue was down 32% from the prior year. Full-year revenue was $63.1 billion, which was down 20% from the prior year.

Intel cut jobs and took steps to cut costs in the fourth quarter. It said it set cost-reduction targets of $3 billion in 2023, and is looking to reach $8 billion to $10 billion by the end of 2025.