Intel’s 28% Plunge Erases $12 Billion From Government Holdings

Market turmoil and stake losses

Intel suffered one of its worst single‑day declines on Friday, with shares tumbling roughly 28% after the company issued a weaker fourth‑quarter forecast. The sell‑off knocked $12 billion off the value of the government’s 10% stake, which the Trump administration acquired more than a year ago, according to CNBC. Nvidia, which also secured a sizable position in Intel earlier in 2025, saw its own stock dip modestly on the same day. The broader technology sector, particularly chipmakers, was caught in the same downward spiral.

Financial warning and profitability metrics

Intel warned investors to expect fourth‑quarter revenue between $15 billion and $16 billion, short of the roughly $17 billion analysts had projected. The company also cautioned that its gross profit margin would fall to 37% from 43% and that heavy capital spending would leave it with no positive cash flow for the period. Despite the recent slide, Intel remains a profitable investment for both the government and Nvidia, having gained more than 70% year‑to‑date, although it is well below the peak prices reached over the summer.

PC slowdown pressures and CEO remarks

“Our customers began signaling a PC slowdown based on the memory prices and availability. Year‑to‑date system endpoint prices have increased significantly, placing additional pressure on already limited IT budgets,” Intel CEO Lip‑Bu Tan told analysts.

The slowdown is driven by the AI industry’s voracious demand for memory and other components, which has pushed up PC prices and constrained consumer and enterprise spending.

Data center growth and capacity constraints

Intel’s data‑center business delivered a bright spot, with revenue soaring 78% compared with the same quarter a year ago. However, expanding that momentum is hampered by limited fab capacity and the need to secure more external customers to compete with industry leader Taiwan Semiconductor Manufacturing Co. One of Intel’s new facilities in Arizona is now operational, but the next plant is not expected to come online until 2028.