Intel Q3 Preview: Nvidia, US Government Stakes Don't Change Narrative – 'Do Not Believe Valuation Is Justified'
Intel Corporation is set to report its Q3 financial results, with analysts expecting revenue of $13.14 billion, down from $13.28 billion a year ago. Despite recent market share losses and a downgrade from Bank of America, some analysts believe Intel's results may exceed expectations due to improved industry conditions. However, concerns about the company's valuation persist, with Wedbush maintaining a Neutral rating and Bank of America downgrading to Underperform. Key items to watch include product announcements and the impact of recent investments from NVIDIA and the U.S. government.
Intel Corporation (NASDAQ:INTC) has several key areas to address, including new products and growth plans, ahead of its third-quarter financial report, which is scheduled to be released on Thursday after the market closes.
Here are the earnings estimates, what analysts are saying and key items to watch.
Earnings Estimates: Analysts expect Intel to report Q3 revenue of $13.14 billion. That’s down from $13.28 billion in last year's third quarter, according to data from Benzinga Pro.
The company exceeded analyst estimates for revenue in four consecutive quarters. It also beat estimates in eight of the last 10 quarters overall.
Analysts expect Intel to report 1 cent in earnings per share for Q3. A year ago, the company experienced a loss of 46 cents per share.
The company missed analyst estimates for earnings per share in the second quarter. Still, it beat forecasts for earnings in seven of the last 10 quarters overall.
The company’s guidance calls for Q3 revenue between $12.6 billion and $13.6 billion, with a loss of 24 cents per share.
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On prediction market Polymarket, 76% of users believe Intel will beat earnings per share estimates in the third quarter. The prediction market is using an estimate of breakeven earnings for the quarter.
What Analysts Are Saying: The semiconductor company could show improvement in operations and guidance when it reports Thursday, Wedbush analyst Matt Bryson said in a recent investor note.
"While we struggle to justify the company's recent surge in valuation, we also are reluctant to shift our opinion on the stock into an earnings period where Intel's results/outlook should show improvement," Bryson said.
The analyst maintained a Neutral rating on Intel and raised the price target from $19 to $20.
"We believe that results and guidance should exceed consensus forecasts given a better industry backdrop than we had previously contemplated."
The analyst said PC industry sales are trending towards growth, with artificial intelligence likely to help Intel's Servers segment.
Bryson said Intel's gross margins could benefit from improved volumes and utilization.
The analyst says Intel's stock is too richly valued based on historical valuations and shares have been inflated due to investments in the company by NVIDIA Corporation (NASDAQ:NVDA), Softbank and the United States government.
"We see these deals as having bolstered the balance sheet and created investor optimism, but also not really having changed the fundamental narrative."
The analyst said Intel's success will be determined by its ability to improve its fab and chip design execution. Bryson said Panther Lake ramp in early 2026 could be one of the next catalysts for the company on that front.
"We do not believe Intel's valuation is justified."
Bank of America Securities analyst Vivek Arya recently downgraded Intel stock ahead of the financial results taking the rating from Neutral to Underperform. The analyst has a price target of $34 on shares.
Arya highlighted recent market share losses from Intel to competitors like Advanced Micro Devices and Arm Holdings and limited AI integration, despite a partnership with Nvidia.
The analyst also attributes the recent increase in Intel's value to improved finances and the company's potential in external foundry services, rather than meaningful progress in future products.
Here are other recent analyst ratings on Intel stock and their price targets:
- Morgan Stanley: Maintained Equal-Weight rating, raised price target from $23 to $36
- Wells Fargo: Maintained Equal-Weight rating, raised price target from $22 to $30
- Mizuho: Maintained Neutral rating, raised price target from $23 to $39
Key Items to Watch: The recent stakes in the company could be key talking points during the company's conference call.
Prediction market Kalshi has a market on what words and phrases will be said. Among the top bets are Nvidia (93%), Data Center (92%) and Intel Foundry (91%).
Also listed as options are terms like Tariff (80%), Trump (67%) and Department of Defense (39%).
Intel is likely to highlight recent product announcements and upcoming products to increase investor optimism in the future.
The company recently unveiled Crescent Island GPU, a data center processor that could increase share in the AI chip market.
Intel expects its Panther Lake processors to begin shipping later this year. The company is hoping Panther Lake will help with share gains in the AI, Gaming and edge solutions sectors.
Price Action: Intel stock is down 3.5% to $36.78 on Wednesday, versus a 52-week trading range of $17.66 to $39.65. Intel stock is up 82.0% year-to-date in 2025.
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