Saad Ullah
Intel's turnaround story took a major step forward this quarter as the chipmaker delivered results that exceeded Wall Street's expectations. The company posted its first quarterly profit in over a year with revenue climbing to $13.7 billion, sending shares sharply higher in after-hours trading.
Earnings Beat and First Profits Since 2023
Trader Charles Janus noted the sharp after-hours move, with INTC climbing almost 8% as investors began to believe the recovery might have real legs. Intel reported $13.7 billion in revenue, up 3% year-over-year and ahead of estimates.
The company swung to a net profit of $4.1 billion after posting a $16.6 billion loss in the same quarter last year. Gross margin improved dramatically to 38% from 15%, reflecting better execution and cost discipline.
Chart Analysis: From Base to Breakaway
The daily chart shows a structural shift. Price spent much of 2024 building a base around $19–$20 before breaking out sharply in October, clearing resistance at $26 and $28.71 on strong volume of roughly 122 million shares. INTC now trades around $38.16, testing a supply zone between $36 and $38. Key support sits at $36.00, with secondary support at $32–$33 if momentum weakens. Resistance at $37.50–$38.00 needs to be cleared to open a path toward the low $40s.
Strategy Shift and What's Driving the Re-rating
Management's restructuring reduced the workforce by nearly 30% and refocused engineering resources, driving margin improvement. PC and server chip demand picked up, supported by the AI upgrade cycle and Microsoft system refreshes that improved product mix and pricing. The company also outlined a manufacturing strategy focused on bringing chip production back to the U.S., with backing including a roughly 10% government stake, plus $5 billion from Nvidia and $2 billion from SoftBank.
Risks That Could Cap the Rally
Questions remain about Intel's factory economics and its ability to compete with TSMC's manufacturing edge. Any issues with yield ramps, cost overruns on new facilities, or a slowdown in AI server demand could pressure margins. Technically, failing to hold above $36 would signal fading momentum.
Saad Ullah
