Intel Shares Drop 5% Despite Cisco AI Partnership Amid Tech Sector Weakness

Intel shares tumbled over 5% on Tuesday as bearish sentiment swept through tech stocks. The Nasdaq Composite led declines, falling nearly 1.9% as investors questioned stretched valuations during earnings season. The drop comes despite Intel's strategic win powering Cisco's new edge AI platform with Xeon 6 processors.

Cisco's Unified Edge solution targets AI inferencing outside data centers, with deployments planned for retail, healthcare and industrial settings. "We're extending the full power of the data center to wherever data needs processing," said Intel's Cristina Rodriguez. The partnership underscores Intel's positioning in the AI infrastructure race.

Analysts remain cautious despite Intel's cash generation. Most price targets sit below the current $37.35 level, with some predicting a fall toward $30. The stock currently trades NEAR 52-week highs above its 200-day moving average - technical conditions that could amplify a correction.