Intel shares plunge 28%, wiping $12 billion off the US government's stake

Shares of US chipmaker Intel fell around 28% on Friday, October 30, one of the company's worst trading days ever. The trigger was Intel's forecast for the fourth quarter, which came in weaker than expected. According to CNBC, the slump reduced the value of the US government's Intel holding by $12 billion. The government bought its 10% stake more than a year ago under the Trump administration.

What Intel forecast

Intel warned that quarterly revenue would likely be $15 billion to $16 billion, while analysts had expected about $17 billion. The company said its gross profit margin would fall to 37% from 43%, and that because of heavy investment it expects no positive cash flow.

Trouble in the PC market

The main problem is weakening PC sales. The artificial intelligence industry is absorbing large amounts of memory and other components, pushing PC prices higher. Intel CEO Lip-Bu Tan said on the earnings call that customers had begun signaling a PC slowdown because of memory prices and availability, adding that higher system prices this year are putting extra pressure on already limited IT budgets.

The bright spot

Revenue from Intel's data center business rose 78% from a year earlier. Growth there is constrained, however, by limited factory capacity and the need to win more external customers, where Intel competes with Taiwan's TSMC. One new Intel fab in Arizona is operating, but the next is not expected to come online until 2028.

The selloff hit much of the tech sector, especially chipmakers. Nvidia, which took a large stake in Intel in 2025, also dipped slightly. Even so, Intel stock is still up more than 70% this year, so the investment remains profitable for both the government and Nvidia for now.