Legacy chipmaker Intel posted fourth-quarter revenue of US$13.7 billion for fiscal 2025 - down 4% from the prior year but beating the Street's expectation of $13.41 billion.
Non-GAAP earnings per share landed at $0.15, comfortably ahead of the $0.08 consensus estimate, though the company reported a GAAP loss of $0.12 per share.
Despite the top-and-bottom-line beat, weak guidance for the first quarter of 2026 sent shares slipping 4% in trading.
The chipmaker forecasts Q1 revenue between $11.7 billion and $12.7 billion - missing the $12.55 billion consensus - and expects breakeven non-GAAP EPS, well below the $0.05 analysts had pencilled in.
"We exceeded Q4 expectations across revenue, gross margin, and EPS even as we navigated industry-wide supply shortages," Intel CFO David Zinsner said.
"We expect our available supply to be at its lowest level in Q1 before improving in Q2 and beyond."
Intel CEO Lip-Bu Tan, who took the helm in March 2025, emphasised the company's manufacturing progress.
"The introduction of our first products on Intel 18A – the most advanced process technology developed and manufactured in the United States – marks an important milestone, and we’re working aggressively to grow supply to meet strong customer demand," Tan said.
"Our priorities are clear: sharpen execution, reinvigorate engineering excellence, and fully capitalise on the vast opportunity AI presents across all of our businesses."
Q4 stats
Revenue for the full year 2025 was flat at $52.9 billion.
Gross margins for Q4 came in at 37.9% non-GAAP, down 4.2 percentage points year-on-year, but the company sees this dipping further to 34.5% in Q1 2026.
Client Computing Group (CCG) revenue fell 7% to $8.2 billion, remaining the company's largest segment.
Data Centre and AI (DCAI) revenue rose 9% to $4.7 billion, showing signs of life as the company attempts to capture more of the AI infrastructure spend.
Intel Foundry revenue ticked up 4% to $4.5 billion.
Guidance misses expectations
The outlook for Q1 2026 reflects ongoing supply constraints, with the company forecasting:
- Revenue: $11.7-12.7 billion (Consensus: $12.55 billion).
- Non-GAAP EPS: $0.00 (Consensus: $0.05).
- Gross Margin: 34.5% non-GAAP.
The weak guide overshadowed the operational progress, reinforcing investor concerns about the pace of the turnaround under Tan's leadership.
Key deals and developments
The semiconductor giant highlighted several strategic moves and partnerships:
- Intel 18A Ramp: The first products on the sub-2nm process node have launched, a critical step in regaining process leadership from TSMC.
- NVIDIA Investment: A $5 billion investment from NVIDIA, completed in late 2025, has strengthened the balance sheet.
- U.S. Government Stake: The federal government now holds an approximate 5.5% equity stake following an $8.9 billion investment, solidifying Intel as a "national champion" for domestic silicon.
- Cost Reductions: Operating expenses (R&D and MG&A) fell 14% year-on-year in Q4 to $4.0 billion non-GAAP.
How are the rivals doing?
While Intel fights to stabilise, its competitors are capitalising on the AI boom:
- TSMC: The foundry leader reported a stunning Q4 earlier this month, with revenue surging 25.5% to $33.7 billion and net income jumping 35% to $16 billion, driven by insatiable demand for advanced AI chips.
- AMD: Set to report Q4 earnings on February 3, with analysts expecting strong data centre growth to challenge Intel's legacy market share.
- NVIDIA: The AI kingmaker continues to dominate, having "knocked it out of the park" in its last report. It is expected to unveil its Q4 fiscal 2026 results in late February, with the market watching for the impact of its Blackwell ramp.
The market
Intel shares had rallied significantly in early 2026, gaining 9% on January 9 alone following White House endorsements of its "Make in America" strategy.
However, the 4% slip post-earnings suggests the market is still wary of execution risks. With the stock trading around the $26 mark, investors are weighing the long-term potential of the 18A node against the immediate pain of supply shortages and break-even quarters.
