Why Intel Stock Tumbled on Friday - Tech Giant’s Setback Sparks Market Jitters

Intel shares took a nosedive as Friday's trading session delivered a brutal reality check to chip stock enthusiasts.

Market analysts point to disappointing earnings guidance and mounting pressure from competitors eating into Intel's core markets. The semiconductor pioneer's struggle to maintain its edge sent shockwaves through the tech sector.

While traditional investors panic-sold, crypto traders barely noticed—too busy celebrating another ATH to care about legacy tech's quarterly performance anxiety.

Image source: Getty Images.

Citi's the odd one out

It's worth noting that Citi seems pretty lonely in its pessimism. According to data from The Fly, at least four separate investment banks have raised their price targets on Intel since news of the Nvidia investment appeared. One banker, Benchmark, even upgraded Intel stock on the news, and set a $43 price target.

But not Citigroup.

While reluctantly raising its price target in tandem with the rising stock price, Citi complains that "investors expect that a foundry deal is upcoming," but Intel's foundry business "has a minimal chance of succeeding," reports The Fly.

Is Intel stock a sell?

Foundry worries lie at the heart of Citi's decision to downgrade Intel stock and, I must admit, Nvidia does have its work cut out for it if it hopes to help turn around the fortunes of its rival.

According to S&P Global Market Intelligence data, Intel's foundry business did only $17.5 billion in revenue last year, and foundry revenue has been falling for the last two years. The foundry unit also lost $8 billion in 2024 -- meaning for every $1 worth of chips Intel makes on contract for a customer, the company loses about $0.46.

It's Intel's biggest money loser by far -- and the biggest problem Nvidia must help solve.