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Trump's Intel Boast Fades as U.S. Stake Loses $11 Billion
Intel stock plunged 29% on Friday, erasing $11 billion from the U.S. government's stake, though the holding still shows a gain.
02/11/2026 00:288 min read
On Friday, Intel (INTC) shares dropped 29% following a weaker-than-expected outlook, cutting roughly $11 billion from the U.S. government's investment. That decline affects a position that President Donald Trump has previously touted as earning billions for the country.
Intel ended Friday at $65.76, as per TradingView data. Even so, with an average purchase price of $20.47 per share, the government's holding remains up by close to $20 billion.
What Caused Intel's Stock Drop Despite Beating Forecasts?
According to CNBC, Friday marked Intel's steepest single-day decline since 1974, following a roughly 150% rally this year. Nonetheless, the stock remains 74% higher year-to-date.
The chipmaker beat quarterly profit expectations, but revenue came in a bit short and its Q4 guidance fell short of forecasts.
Results were pulled down by sluggish PC demand and elevated memory chip costs. Intel anticipates the PC downturn will persist into the coming year.
The server business was constrained by supply issues. A blast at an Israeli chip facility in October impacted the data center segment.
Yet, data center and AI revenue totaled $7.3 billion, climbing almost 80% compared to the same period last year.
Is the U.S. Government's Intel Investment Still Profitable?
Trump shared a post depicting Intel's rise from $20 to $95. Friday's closing price is about $29 short of the $95 level he highlighted.
New Street raised its rating on Intel to buy. In contrast, Bank of America, Roth Capital Partners, and Seaport Research Partners lowered theirs to neutral.
KeyBanc analyst John Vinh described the sell-off as overdone and anticipates server capacity will come online in the second half of 2027.
Vinh believes investors should price Intel based on 2030 projections, when he forecasts the foundry (contract chipmaking) segment will start contributing.
On the other hand, Seaport Research Partners' Jay Goldberg predicts sideways trading until Intel resolves its capacity issues. He noted that Intel produced too many PC chips during the slump and not enough server chips to meet growing demand.
Both analysts view government ownership alone as insufficient reason to purchase the stock.
Intel's CEO Lip-Bu Tan forecasts a 30% annual increase in industry server processor units for 2026 and 2027. He added that additional supply could drive that number even higher.
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Disclaimer: this article comes from third-party media and is provided for reference only. It does not constitute investment advice. Crypto and other financial products carry significant price volatility risk, so please make your own decisions carefully.
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