Intel Shares Fall Nearly 26% After Fourth-Quarter Profit Outlook Misses

Intel shares opened down nearly 26% Friday after the company forecast fourth-quarter non-GAAP earnings of $0.25 per share, below expectations and less than half its third-quarter result.

Intel reported third-quarter revenue of $16.5 billion, a 21% increase from the same period a year earlier. Non-GAAP earnings were $0.52 per share, making the fourth-quarter forecast $0.27 lower, or about 52% below the reported result.

The company projected a fourth-quarter gross margin of 38%, compared with 44.1% in the third quarter. That is a decrease of 6.1 percentage points between the reported quarter and the next quarter’s forecast.

Intel’s outlook puts both earnings per share and gross margin below their third-quarter levels, even as its latest revenue grew year over year. The revenue comparison is annual, while the earnings and margin comparisons are between the reported quarter and the following quarter’s forecast. The per-share figures are stated on a non-GAAP basis.