Intel shares plunge 20% on weak forecast as memory costs hit PC sales

Intel shares plunged over 20% in after-hours trading after the company's business forecast disappointed investors. The chipmaker projected quarterly revenue of $15-16 billion, well below the $17 billion analysts expected, with adjusted earnings per share forecast at 25 cents versus the 43-cent market estimate. Intel cited rising memory prices reducing PC purchases and supply chain problems for data center chips as key factors. CFO David Zinsner said weakness would persist through at least the first half of 2027, while CEO Lip-Bu Tan noted the entire market is affected, with PC sales expected to shrink 10% in 2027. Memory prices have surged due to AI data center demand, and Intel struggled to meet that demand due to raw material shortages and a temporary factory closure in Israel. Despite quarterly revenue rising 21% year-over-year to $16.5 billion, profit fell 18% to $3.3 billion.