Why Intel (INTC) Stock Is Falling Today

What Happened?

Shares of computer processor maker Intel (NASDAQ:INTC) fell 3.7% in the afternoon session after a downgrade from Citigroup analysts cast doubt on the chipmaker's valuation following a massive rally. 

The stock retreated after soaring nearly 23% in the previous session on surprising news that rival Nvidia planned to invest $5 billion in the company and collaborate on new chips. Despite the positive momentum, Citigroup shifted its rating to 'Sell' from 'Neutral.' The bank's analysts argued that Intel's stock price already reflected success in its chip manufacturing business, which they believed had a "minimal chance to succeed" against established competitors. This bearish view contrasted sharply with Benchmark analysts, who upgraded Intel to 'Buy' on the same day, highlighting a divided view on Wall Street. The downgrade appeared to prompt investors to take profits after the stock's best day in decades.

The shares closed the day at $29.55, down 3.3% from previous close.

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What Is The Market Telling Us

Intel’s shares are extremely volatile and have had 33 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 1 day ago when the stock gained 26.6% on the news that Nvidia announced a landmark $5 billion investment in the company and a strategic pact to jointly develop new chips. 

The groundbreaking deal united two of Silicon Valley's longest-running competitors to create processors for personal computers and data centers. This collaboration was seen as a potential lifeline for Intel, which had been battling declining market share. Under the agreement, Intel will build custom processing units that Nvidia will integrate into its AI infrastructure. The move sent shockwaves through the semiconductor industry, as it posed a potential risk to competitors. 

For instance, TSMC, which currently manufactured Nvidia's flagship processors, could see that business shift to Intel in the future. Likewise, rival AMD, which competes with Intel in the data center market, saw its shares drop on concerns about the new competitive challenge.

Intel is up 46.4% since the beginning of the year, and at $29.60 per share, it is trading close to its 52-week high of $30.57 from September 2025. Investors who bought $1,000 worth of Intel’s shares 5 years ago would now be looking at an investment worth $595.23.

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