Intel’s data center group, which derives revenue from enterprises and government customers, saw a 7% revenue drop in the quarter. Overall, Intel’s revenue declined 4% year-on-year on September 26 at the end of the quarter.
Bank of America on Friday downgraded Intel’s stock from neutral to underperforming, indicating uncertainty about the company’s new chips and lack of plans to fix or update its manufacturing challenges.
Intel said that in July it delayed its 7 nanometer processor to 2022 for computers and the following year for servers. CEO Bob Swan said the company may start relying on other companies to manufacture its chips, but may not be able to provide more information until January.
Bank of America analysts said in Friday’s note, “The results could be years of uncertainty, with a minimum moving stake in AMD for risk mitigation and customers for more compelling price / performance / convenience inventory.”
Shares of competing chipmaker AMD, which is already selling 7 nanometer chips for PCs and graphics cards, were up more than 1% in the premarket. As of Thursday’s close, the company’s stock was up more than 73% year to date.
As of Thursday’s closing, Intel shares had fallen nearly 10% this year.
– CNBC’s Jordan Novett contributed to this report.
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