Intel beat revenue forecasts by $1.7 billion and posted its best growth in over fifteen years. The stock fell 11% anyway.
AMD had good news of its own and fell 5.5% too. When both drop at once, the cause is usually money leaving the sector.
Intel Stock Fell Through Its Own Earnings Beat
Intel reported revenue of $16.1 billion, up 25%. Analysts had expected $14.42 billion. Its data center and AI unit grew 59% to $6.3 billion. Adjusted earnings hit 42 cents a share.
Our Q2 results represent our strongest revenue growth in more than fifteen years…,” said Lip-Bu Tan, Intel chief executive, in the earnings release.
Finance chief Dave Zinsner went further, promising more spending on factory equipment and materials. Then the selling started. Intel has dropped 10.88% since the results landed.
Its RSI, a momentum gauge, sits at 29.07. Readings that low point to heavy selling.
AMD Fell Too, on Opposite News
AMD had momentum going in. It had just pledged 2 gigawatts of chips to an Anthropic supply deal, backed by a $5 billion investment.AMD still lost 5.49%. Its RSI sits at 40.99.
The whole sector was already weak. The SOXX chip fund trades about 15.7% below its June high. Scott Rubner, head of equity derivatives strategy at Citadel Securities, called it a rare chip signal.
The Inverse Cramer Effect Does Not Scale
Cramer posted “Intel’s the one” after the results. The inverse-Cramer allusion followed.
The research says the opposite. A Management Science study found his picks jump 2.4% overnight on average. Those gains then fade over the following months. The effect is strongest in small stocks that are hard to trade.
Size is the catch. That average move was worth $77.1 million. Intel lost 10.88%.
Cramer had also dumped tech before earnings. He turned cautious on the whole market that morning.
“I’m struggling to have reasons to buy, and I certainly have a lot of reasons to sell,” Jim Cramer said.
He blamed oil, interest rates, and the Middle East. Not chips. The 10-year Treasury yield hit its highest level since January.
Monday’s open will settle it.
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