So Intel beat earnings and still got absolutely smoked today — down almost 30%, on track for its worst day since 1974. That’s the part that got me. The quarter itself wasn’t the disaster. Adjusted earnings came in at $0.52 a share, ahead of expectations, and data center revenue hit $7.3 billion. Then management gave a fourth-quarter forecast nobody wanted to hear: $15 to $16 billion in revenue against roughly $17 billion expected, and $0.25 a share against $0.43 expected. PC demand is still soft, memory prices are climbing because everyone’s chasing AI chips, and Intel says it won’t generate positive cash flow this year.
Amazon piled on overnight. Revenue of $201.94 billion and $1.89 a share both missed estimates, even though AWS grew 39% to about $46 billion. The number Wall Street kept circling was the spending: roughly $220 billion in capital expenditures this year, with free cash flow over the last twelve months swinging to a $42.4 billion outflow from a $14.8 billion inflow a year ago. Put it together with Alphabet’s $500 billion wipeout yesterday and the Nasdaq 100 was on track to lose more than $1 trillion in value today, with AMD down around 10% and Nvidia off a few percent too.
I keep going back and forth on this one. Is this the week investors finally stopped giving AI spending a free pass, or is it just a brutal earnings week that everyone forgets in a month? Intel’s story feels different to me because it’s not just spending — it’s a turnaround that keeps getting pushed out. What do you think, is the AI trade actually cracking or just catching its breath?
