Intel Continues to Suck and an Apple Earnings Review

      Intel is one of the most disappointing and predictable companies in the world. They are constantly disappointing, and frankly, I see little future for them, especially after this last quarter. After I dunk on Intel a little, we’re going to review Apple’s earnings, and I may get negative a smidgen with Apple, something I usually avoid because I feel so positive.

       First, a company that has no positivity or good vibes at all, Intel. Intel recently dropped their quarterly earnings, and they were…poor. The stock was down 26% on the day, and 32% over the past five days. Intel lost $1.6 billion last quarter, which is especially bad because it made $1.5 billion in profit one year ago. Margins shrunk 25%, total revenue fell 10%, and obviously, profit cratered.

       The company is planning to lay off 15,000 employees by the end of the year, which seems overboard to me. Intel has 130,000 employees as of last quarter, so they’re planning to lay off about 12% of the company; a loss of that many employees will have an impact. Some genuinely valuable talent will fall into that pool of those laid off, and more importantly, future talent will fall into that pool. This may be a decision that helps them bring profit up in the short-term, but over the long-term, Intel will regret this panic decision. I’m not anti-CEO making money, but their CEO pulled in $17 million last year while the company fell apart, so I should hope that he and the rest of the executive team are cutting their obviously unjustified salaries by at least 50%. This disaster is not the fault of the employees who are about to be fired, rather, it is the fault of hilariously poor management, yet the employees are paying the cost of management’s stupidity.

        But yeah, the company sucks. Intel has missed the AI chip wave. While Nvidia and AMD are pulling in record revenue and profit, Intel turned $1.5 billion of profit into $1.6 billion of loss. Intel isn’t going to evaporate overnight. They have some loyal corporate customers, and it is extremely tough to switch, so they aren’t going to die immediately, but this is a dying company, and I do not see a viable path with this management for that to change. In 20 years, Intel will have imploded a decade earlier, unless something changes.

        Now, on to a much happier topic, Apple. Apple has had a bit of a renaissance recently, as some negative sentiment has turned positive, and the stock has erased a single-digit loss with a double-digit gain YTD. This most recent quarter was, in my opinion, mixed.

       iPhone sales decreased by 1% from one year ago, but overall revenue increased by 5%, which is decent growth for a company of Apple’s size, but it’s not as good as Microsoft or Amazon, companies of similar size. Apple Intelligence is supposed to be the technology that re-invigorates new iPhone sales, but I am pessimistic. I just don’t see a customer upgrading their phone, dropping over $1000 just because of some ChatGPT-level AI system. There is quite a bit of optimism in the market that this new AI (Apple Intelligence *eye roll*) will be the catalyst that brings a new era of iPhone into the present, but as I said, I am less optimistic. However, Apple is still an excellent company and even if the AI isn’t a complete success, I have no belief that it will be a total failure.

        Apple, to me, is a light hold. If 1-3 is sell, 4-6 is hold, and 7-10 is buy, Apple is a 4.5. Thanks Tim GOAT.