Intel's stock has faced significant pressure in early 2026, primarily due to a "Guidance Shock" in late January that saw shares plunge 17% in a single day. Despite beating fourth-quarter 2025 earnings expectations, the company's outlook for the first quarter of 2026 was far below analyst estimates, driven by operational bottlenecks rather than a lack of demand.

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Key Drivers of the Decline

Supply Chain Constraints: Intel admitted it cannot meet surging demand for AI-focused data center chips. Specifically, a shortage of specialized substrates and high-bandwidth memory (HBM) has prevented the company from fulfilling orders even as its factories run at full capacity.

Manufacturing Yield Challenges: While Intel's "make-or-break" 18A process node is in high-volume manufacturing, yields remain below target levels. This has pressured profit margins and raised concerns about Intel's ability to reliably deliver on major foundry contracts for partners like Apple and Microsoft."#Write2Earrn @EthioCoinGiram1