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Intel (NASDAQ:INTC) shares dropped about 5% in Friday's premarket session after the chipmaker delivered stronger-than-expected Q1 earnings but offered a cautious second-quarter outlook.
The company posted adjusted earnings and revenue above analyst estimates for the March quarter. However, its Q2 revenue forecast of $11.2 billion to $12.4 billion came in below the $12.82 billion consensus, and it expects to break even on an adjusted per-share basis, short of the $0.07 profit analysts had projected.
Intel cited persistent macroeconomic headwinds and ongoing challenges in the tech supply chain as key factors weighing on forward guidance. Global trade uncertainty and softening demand in some data center and PC markets continue to cloud visibility, according to the company.
To counter these pressures, Intel trimmed its full-year 2025 operating expense target to $17 billion and lowered capital expenditures to $18 billion. The company said it remains focused on long-term investments in manufacturing and AI infrastructure, despite near-term belt tightening.
This article first appeared on GuruFocus.