Intel misses estimates, suspends dividend, announces layoffs with 26% stock drop; Arm falls 16%.

From Nasdaq: 2024-08-07 04:20:00

Intel (NASDAQ: INTC) and Arm Holdings (NASDAQ: ARM) took a hit after earnings reports. Intel missed estimates, suspended its dividend, and announced layoffs, causing its stock to drop 26%. Meanwhile, Arm beat estimates but fell short on guidance, leading to a 16% drop.

Intel’s struggles stem from falling behind in chip manufacturing, losing market share to AMD, costing CEOs their jobs, and facing revenue declines. Arm’s business model relies on licensing designs to chipmakers and is more focused on faster-growing markets like AI and cloud.

While Intel seems cheap at 20 times forward earnings, Arm still isn’t a bargain at 73 times earnings. If forced to choose, investing in Arm may be the better option due to faster growth rates and less capital-intensive operations.

Before investing in Intel or Arm, consider other potential opportunities identified by The Motley Fool Stock Advisor analyst team for potentially higher returns. The service has historically outperformed the S&P 500 since 2002.



Read more at Nasdaq: Better Chip Stock: Intel vs. Arm Holdings