Intel shares plunge 45% in October as guidance warning derails AI story

Intel stock collapsed on the last trading day of October 2026, plunging 29% in a single session — its worst one-day performance since the 1970s — after a profit warning rocked the AI investment story that had powered its rally. For the full month of October, shares shed 45%, FactSet data showed, marking the worst monthly decline in Intel's history; on the first trading day of November the stock fell another 8%. The trigger was a quarterly outlook in which Intel warned that revenue would come in $1 billion to $2 billion below analyst expectations. The company pointed to the PC market, where memory and other component costs have remained elevated and consumers have grown reluctant to upgrade their computers. PCs still generate roughly half of Intel's revenue, so the weakness was glaring. Just months earlier Intel had been a market darling. In August 2025, the U.S. government bought a 10% stake in the company, and Nvidia followed with a $5 billion investment. Buoyed by the two deals, Intel shares soared sixfold in ten months and peaked in June 2026. During that run, investors were excited about Intel's positioning in the AI wave: its CPUs were being used to run the virtual machines that power agentic AI applications such as Meta's Muse, carving out a role distinct from the GPUs made by Nvidia and AMD. That narrative has now been interrupted by the quarterly warning. According to the report, CEO Lip-Bu Tan said the global server processor market could grow fivefold from current levels to about $200 billion over the next five years, positioning the data center as Intel's new hope — though the article ends with output capacity already stretched, and no further developments have been reported since.