Intel Cut Chip Capacity At The Worst Possible Time — And Its Stock Paid The Price
Portrait of Andy Grove, from Intel, at the annual PC Forum, Tucson, Arizona, March 10-13, 1991. (Photo by Ann E. Yow-Dyson/Getty Images)
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Intel stock lost 17% of its value last Friday, reported the Wall Street Journal.
On the surface, the reason for the drop was Intel’s mixed results for the fourth quarter of 2025. Intel exceeded expectations for revenue and adjusted earnings per share while projecting significantly lower growth for the first quarter of 2026.
The root cause of the disappointing guidance — a reduction in manufacturing capacity ahead of a big increase in demand for Intel’s central processing units — strikes me as a stunningly bad strategic decision.
“We are on a multiyear journey,” said Intel CEO Lip-Bu…
