We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Intel's stock recently plunged 28%, dragging down AMD in sympathy.
Intel suffers from PC market reliance.
AMD's data center business is thriving and is now its largest segment.
What Was Behind Intel’s Post-EPS Plunge?
Last week, Intel ((INTC - Free Report) ) shares plunged 28% in a single-session after the company reported third-quarter results. In light of the Intel news, fellow chipmakers like Advanced Micro Devices ((AMD - Free Report) ) were dragged down by investors in sympathy.
Image Source: Zacks Investment Research
Intel: Earnings Beat Expectations, Falls Short
Intel’s earnings were very strong, up 126% year over year and beating Wall Street analyst expectations. However, investors punished Intel shares with the worst single-session stock decline in decades after abysmal guidance. Intel’s guidance range of $15-$16B fell dramatically short of Wall Street’s $17.1B estimate.
PC Sales Are a Headwind for Intel
Intel plunged largely due to a severe downturn in PC sales. Intel's core Client Computing Group (PC segment) continues to suffer from soaring memory and component costs (such as DRAM and SSDs). Management noted that PC unit shipments are expected to drop roughly 12% in 2026 and another 10% in 2027 as consumers and enterprise budgets shrink.
Intel is Heavily Reliant on PC Demand
Unlike other chip leaders like AMD and Nvidia ((NVDA - Free Report) ), Intel relies more heavily on the PC market. Roughly half of its revenue dependends on PC demand. In addition, Intel’s margins are being squeezed, and it cannot meet full demand due to industry-wide shortages of chip-packaging substrates and wafers.
Image Source: Zacks Investment Research
AMD’s Data Center Business is Exploding
Tuesday, AMD’s Q3 earnings helped to clear the air. AMD reported year-over-year revenues that jumped 74% while earnings grew 45%. However, the most important quote came from CEO Lisa Su:
“We now expect revenue to grow more than 80% in 2027. Data Center is now expected to account for over 80% of AMD's total revenue in 2027, up from 64% in Q3.”
In other words, AMD is less a PC company and more an AI-first company now benefiting from surging demand.
Intel’s Issues are AMD’s Opportunity
Intel disclosed that it expects agentic AI to expand the server CPU market 5x to over $200B while admitting supply cannot keep up with demand. This supply-demand imbalance creates an opportunity for AMD to steal market share from Intel.
Image Source: Zacks Investment Research
Bottom Line
Recent earnings results show diverging paths for Intel and AMD. While Intel relies heavily on its legacy PC business, AMD is capitalizing on the unprecedented AI data center buildout.
View the Zacks #1 Rank List
Image: Bigstock
AMD EPS: Intel's Drag Makes No Sense
Key Takeaways
What Was Behind Intel’s Post-EPS Plunge?
Last week, Intel ((INTC - Free Report) ) shares plunged 28% in a single-session after the company reported third-quarter results. In light of the Intel news, fellow chipmakers like Advanced Micro Devices ((AMD - Free Report) ) were dragged down by investors in sympathy.
Image Source: Zacks Investment Research
Intel: Earnings Beat Expectations, Falls Short
Intel’s earnings were very strong, up 126% year over year and beating Wall Street analyst expectations. However, investors punished Intel shares with the worst single-session stock decline in decades after abysmal guidance. Intel’s guidance range of $15-$16B fell dramatically short of Wall Street’s $17.1B estimate.
PC Sales Are a Headwind for Intel
Intel plunged largely due to a severe downturn in PC sales. Intel's core Client Computing Group (PC segment) continues to suffer from soaring memory and component costs (such as DRAM and SSDs). Management noted that PC unit shipments are expected to drop roughly 12% in 2026 and another 10% in 2027 as consumers and enterprise budgets shrink.
Intel is Heavily Reliant on PC Demand
Unlike other chip leaders like AMD and Nvidia ((NVDA - Free Report) ), Intel relies more heavily on the PC market. Roughly half of its revenue dependends on PC demand. In addition, Intel’s margins are being squeezed, and it cannot meet full demand due to industry-wide shortages of chip-packaging substrates and wafers.
Image Source: Zacks Investment Research
AMD’s Data Center Business is Exploding
Tuesday, AMD’s Q3 earnings helped to clear the air. AMD reported year-over-year revenues that jumped 74% while earnings grew 45%. However, the most important quote came from CEO Lisa Su:
“We now expect revenue to grow more than 80% in 2027. Data Center is now expected to account for over 80% of AMD's total revenue in 2027, up from 64% in Q3.”
In other words, AMD is less a PC company and more an AI-first company now benefiting from surging demand.
Intel’s Issues are AMD’s Opportunity
Intel disclosed that it expects agentic AI to expand the server CPU market 5x to over $200B while admitting supply cannot keep up with demand. This supply-demand imbalance creates an opportunity for AMD to steal market share from Intel.
Image Source: Zacks Investment Research
Bottom Line
Recent earnings results show diverging paths for Intel and AMD. While Intel relies heavily on its legacy PC business, AMD is capitalizing on the unprecedented AI data center buildout.