.August 2, 2024 12:27 PM

Intel Corporation (NASDAQ:INTC) reported disappointing Q2 results, with adjusted earnings of $0.02 per share and revenue of $12.83 billion, missing Wall Street expectations of $0.10 per share and $12.93 billion. This led to a 27% drop in stock price.

Factors contributing to the miss include margin pressures from AI PC product ramp-up, higher charges related to non-core businesses, and unused capacity impact. Intel’s gross margin fell to 35.4%.

Intel surprised investors by suspending its dividend in Q4 to conserve cash amid challenges. The company expects a tough Q3, forecasting an adjusted loss of $0.03 per share on revenue between $12.5 billion and $13.5 billion, contrasting sharply with analyst estimates.

Looking forward, Intel anticipates a further decline in gross margin to 34.5% in Q3. To address financial pressures, the company plans significant cost-cutting measures, including a more than 15% reduction in its workforce to resize and refocus operations.