Intel's 28.6% collapse sank chip stocks and handed the Nasdaq its worst month since March 2025
Lip-Bu Tan's Intel had its steepest drop on record after a weak outlook and a warning on cash flow. The semiconductor index fell 7.2%, the Nasdaq lost 2.9% on Friday, and October ended with tech in retreat.
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October's last session was its worst for technology stocks. Intel's outlook, released late Thursday, turned a week of doubts about AI spending into a broad sell-off in chipmakers, and the Nasdaq Composite went into the weekend with its biggest monthly loss in a year and a half.
The Nasdaq fell 747.73 points, or 2.86%, to 25,437.00, according to Reuters, its largest one-day percentage drop since June 5. The S&P 500 lost 140.32 points, or 1.82%, to 7,580.07, and the Dow Jones Industrial Average fell 572.25 points, or 1.09%, to 51,770.31. Yahoo Finance data matched all three closes.
Intel: the steepest drop in its history
Intel closed down 28.6% at $65.76, Reuters reported, a fall that Reuters said during the session was on track to be the biggest one-day decline in the company's history. The stock had closed at $92.07 on Thursday, according to Yahoo Finance data.
The quarter itself was not the problem. The guidance was. Intel forecast fourth-quarter revenue of $15 billion to $16 billion and adjusted earnings of 25 cents a share, CNBC reported, short of the LSEG consensus of $17.1 billion and 43 cents. Reuters said the company also does not expect positive free cash flow this year.
Reuters tied the warning to strains from the AI buildout: as AI demand sends memory prices soaring, companies that depend on consumer devices, from PC sellers to smartphone makers, face higher costs and softer demand.
The fall reached beyond the stock. The cost of insuring Intel's debt against default rose to an all-time high, with five-year credit default swaps widening 17.5 basis points to 124.75, according to Markit data cited by Reuters. The U.S. government, Intel's largest shareholder after taking a 10% stake in August last year, faced a hit of nearly $12 billion to the value of its holdings, Reuters said. Intel held $21.84 billion in cash and cash equivalents at the end of September, against $46.32 billion in long-term debt.
The chip index fell 7.2%
The damage spread across the sector. The PHLX semiconductor index shed 7.2%, Reuters reported, leaving it with a loss of more than 15% for October. AMD fell 10.9% and Nvidia 4.2%, according to Reuters, and Qualcomm closed down 11.12% at $164.79, Yahoo Finance data show.
Sandisk, one of the biggest winners of the AI spending boom, fell 13.47% to $1,150.89 even after reporting adjusted earnings of $49.51 a share against the $46.22 LSEG estimate and announcing an eight-for-one stock split, according to CNBC and Yahoo Finance data. Server makers fell too: Dell lost 10.8% and HP 9.6%, Reuters said.
Overseas, Reuters reported that ASML fell more than 6% and South Korea's KOSPI slid 3.5%.
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Amazon pared its losses
Amazon, the other big report from Thursday night, had a better day than its premarket indication suggested. Reuters said the stock pared losses as the session went on, and it closed down 1.41% at $240.35, according to Yahoo Finance data. Microsoft, Meta and Alphabet fell 1% to 2%, Reuters reported, after steep declines earlier in the week.
The broader tape was weak. Decliners outnumbered advancers by 1.8 to 1 on the New York Stock Exchange, with 169 new highs and 377 new lows, Reuters said. The Nasdaq 100 fell 3.5%, putting it on the brink of a correction, and the Cboe Volatility Index rose 12.91% to 19.42, Yahoo Finance data show.
How October ended
The Nasdaq Composite fell 5.3% in October, its biggest one-month decline since March 2025, Investopedia reported, and Reuters said it closed 7.8% below its all-time closing high from Oct. 6. The S&P 500 slipped 0.9% for the month, while the Dow gained 1.7%, according to Investopedia.
Reuters said the S&P 500 technology sector had its largest monthly percentage loss since March 2025, and communication services had its biggest monthly drop since April 2022. Earnings themselves have mostly been solid: of the 299 S&P 500 companies that have reported third-quarter results, 82% beat expectations, according to LSEG data cited by Reuters.
What carries into Monday
November opens with Apple's fiscal fourth-quarter results on Monday, Nov. 2, the last megacap report of the season. After a week in which Alphabet, Amazon and now Intel were judged on cash flow as much as growth, Apple's numbers arrive with the chip sector already down sharply for the month.
