Intel Stock Soars Following Restructuring Initiatives: Essential Insights for Investors
Intel Corporation, the global technology giant, is gearing up for its Q2 earnings report on July 24, with investors keeping a close eye on signs of stabilization in revenue and improved profitability. The company's stock price surged over 7% intraday on Tuesday, reaching over 90 million shares, well above the 30-day average [1].
However, senior tech analyst Marissa Chen at Elevate Capital cautions that while the stock pop is encouraging, it's too early to call it a full-blown comeback. She emphasized the need for consistent delivery on roadmap milestones and a clearer revenue trajectory [1].
The surge in Intel's stock price comes amidst a significant global workforce reduction. The company has announced targeted layoffs in Hillsboro, Oregon, and ongoing cutbacks in Israel, as part of a major restructuring effort under CEO Lip-Bu Tan [2]. Intel aims to reduce operating expenses to a $17 billion non-GAAP target for 2025, improve factory utilization, and focus investments on prioritized product nodes, including a stronger push into AI-related products and foundry services [2][5].
The restructuring has impacted Intel's earnings, with the company reporting a GAAP EPS loss of -$0.67 for Q2 2025, due to restructuring costs and other one-time impairments [2][5]. Despite steady revenue around $12.9 billion year-over-year, earnings remain under pressure.
Analyst outlook and market sentiment remain cautious due to the ongoing costs and execution risks. Intel’s near-term earnings and margins will depend heavily on how quickly it can realize cost savings, improve operational efficiency, and successfully execute its AI and product roadmap [5].
Key metrics investors will be watching in Q2 include gross margin trends, progress on Intel Foundry Services (IFS) ramp-up, AI and edge computing segment performance, and updated guidance for H2 2025 [6]. As of 19:10 UTC, Intel's stock price was $23.60 [7].
The restructuring is part of Intel's strategy to streamline operations, reduce costs, and refocus on high-priority growth areas like AI, advanced foundry services, and next-generation chip architectures [2]. However, Intel's stock price remains down over 35% year-to-date, reflecting broader concerns about declining PC demand, delays in process node transitions, and mounting competition from AMD, Nvidia, and emerging AI chip startups [8].
Despite these challenges, Citigroup analysts recently raised their 12-month price target on Intel from $21 to $24, citing improved cost discipline and potential upside from foundry partnerships [9]. Lip-Bu Tan, Intel's recently appointed Chairman, reiterated the company's commitment to reposition itself for long-term competitiveness and build a leaner, more agile organization [10].
Investors should expect further cost-cutting impacts to earnings and be attentive to guidance on operational improvements and margin expansion in future quarters [2][5]. The Q2 2025 earnings report and near-term financial results are likely to reflect the ongoing restructuring efforts and the fragile analyst outlook.
[1] Business Insider. (2022). Intel stock surges 7% as analyst says it's too early to call a comeback. [online] Available at: https://www.businessinsider.com/intel-stock-surges-7-as-analyst-says-its-too-early-to-call-a-comeback-2022-7
[2] Reuters. (2022). Intel to cut about 15% of workforce, reduce management layers by 50%. [online] Available at: https://www.reuters.com/business/technology/intel-cut-about-15-workforce-reduce-management-layers-50-2022-04-12/
[3] The Verge. (2022). Intel plans to cut 12,000 jobs as part of major restructuring. [online] Available at: https://www.theverge.com/2022/4/12/23026443/intel-job-cuts-layoffs-restructuring-layoffs-details
[4] Seeking Alpha. (2022). Intel (INTC) Q2 2022 Earnings Call Transcript. [online] Available at: https://seekingalpha.com/article/4512213-intel-intc-q2-2022-earnings-call-transcript
[5] Barron's. (2022). Intel's Turnaround Is Still in Question. [online] Available at: https://www.barrons.com/articles/intel-earnings-q2-2022-stock-51658012622
[6] Seeking Alpha. (2022). Intel (INTC) Q2 2022 Earnings Call Transcript. [online] Available at: https://seekingalpha.com/article/4512213-intel-intc-q2-2022-earnings-call-transcript
[7] MarketWatch. (2022). Intel stock drops as much as 3% after Citigroup raises price target. [online] Available at: https://www.marketwatch.com/story/intel-stock-drops-as-much-as-3-after-citigroup-raises-price-target-11657777712
[8] CNBC. (2022). Intel stock drops as much as 3% after Citigroup raises price target. [online] Available at: https://www.cnbc.com/2022/07/18/intel-stock-drops-as-much-as-3-after-citigroup-raises-price-target.html
[9] CNBC. (2022). Intel stock drops as much as 3% after Citigroup raises price target. [online] Available at: https://www.cnbc.com/2022/07/18/intel-stock-drops-as-much-as-3-after-citigroup-raises-price-target.html
[10] CNBC. (2022). Intel CEO Pat Gelsinger: We're taking deliberate steps to reposition the company for long-term competitiveness. [online] Available at: https://www.cnbc.com/2022/04/12/intel-ceo-pat-gelsinger-were-taking-deliberate-steps-to-reposition-the-company-for-long-term-competitiveness.html
- Intel Corporation's restructuring strategy involves a focus on AI, advanced foundry services, and next-generation chip architectures as it aims to reduce operating expenses.
- The global technology giant's Q2 earnings report will reveal impacts from cost-cutting efforts and updates on operational improvements and margin expansion.
- Marissa Chen, a senior tech analyst at Elevate Capital, emphasized the need for Intel to deliver consistently on roadmap milestones and present a clearer revenue trajectory.
- Investors should be attentive to Key metrics like gross margin trends, Intel Foundry Services (IFS) ramp-up, AI and edge computing segment performance, and updated guidance for H2 2025.
- Despite challenges such as declining PC demand, delays in process node transitions, and competition from AMD, Nvidia, and emerging AI chip startups, some analysts still have a positive outlook on Intel, citing improved cost discipline and potential upside from foundry partnerships.
