INTC warned a short while back and allowed that they would come in at the low end of previous guidance with margins being squeezed due to product mix factors. Since then, AMD has warned twice citing margin pressures and weak end demand. Dell a few days ago raised revenue, earnings, and margin estimates, but specifically said they see nothing but weakness in the PC sector and while they are looking for some increases, it is due to a pickup in market share - they are looking for overall PC sales to decline by 5%. No company in the PC sector that I am aware of is seeing any increase in demand, and most are reporting a renewed weakness as the consumer begins to weaken here.
They are now pushing out deliveries for their 300mm fab and talk is that Capex will be cut for the year. Moreover, there has been talk the past few days of layoffs, and although that rumor is unverified, it fits the rest of the background picture.
Frankly, I see no way that INTC can have a good report, and look for reduced guidance for both next quarter and the full year. The stock has been one of the better performers over the past few days, so I think that the market is still at least somewhat optimistic for their report and CC this afternoon. For myself, I am short INTC and have some Friday 17.50 puts for a crapshoot just in case it is really bad. The biggest danger (other than my being just plain wrong) is that as a member of all the indexes, INTC is a favorite of the PPT when they want to enter. In spite of that, I have been expecting INTC's earnings and guidance to make it a leader to start the markets back down, with help from the other chip and equipment stocks. The equipment sector will see a return of the dreaded words "push-out" and "cancellation" pop up again in their reports, and I suspect they will guide lower also.
Just my opinion, worth what you paid for it. Good luck to you.
mlsoft
AI
