Trading in leveraged ETFs tied to Intel Corp. (NASDAQ:INTC) is flashing a sharp change in investor sentiment after the chipmaker's latest earnings report.
• Intel stock is taking a hit today. What’s weighing on INTC shares?
The Direxion Daily INTC Bull 2X ETF (NASDAQ:LINT), which had surged earlier this year as traders piled into bullish bets ahead of Intel's results, is now in focus as shares of Intel slid roughly 13% in after-hours trading Thursday, and dipped more than 14% after markets opened Friday morning.
In response, LINT plummeted more than 31% Friday morning. Intel's earnings beat expectations, but weaker-than-expected guidance cooled enthusiasm that had driven aggressive positioning through single-stock leveraged products.
LINT had been one of the most active vehicles for traders seeking amplified exposure to Intel, significantly outperforming the stock itself during the pre-earnings run-up. The move reflected short-term conviction rather than long-term investing, with traders using leveraged ETFs to position around a high-stakes catalyst.
"After shares doubled in just over the past four months, the American chipmaker was priced for perfection coming into this evening's earnings," said Ryan Lee, senior vice president of Product and Strategy at Direxion. "Supply shortages weighed heavily on this upcoming quarter's forecast, which should, at least in the near term, cool off this highflyer."
The guidance miss quickly validated those risks, prompting a reset in sentiment across Intel-linked trading products.
Leveraged ETFs React Quickly, Yet Opportunity Arises
Single-stock leveraged ETFs tend to reflect investor confidence in real time, amplifying both upside optimism and downside disappointment. Intel's post-earnings drop underscores how quickly sentiment can shift when expectations are stretched.
"For traders who believe this pullback presents an opportunity to buy back into one of the best-performing chip stocks," Lee said, "LINT offers 2X daily exposure to INTC."
At the same time, Intel's results are reverberating beyond single-stock ETFs.
Intel Earnings Beat, But Forward Outlook Falters
Intel reported fourth-quarter revenue of $13.67 billion, topping analyst estimates of $13.37 billion, while adjusted earnings came in at 15 cents per share, well ahead of expectations of eight cents.
However, total revenue declined 4% year over year. Client Computing Group revenue fell 7% to $8.2 billion, while Data Center and AI revenue rose 9% to $4.7 billion, reinforcing Intel's long-term AI narrative.
Guidance Sparks Sector-Wide Repricing
Intel guided first-quarter revenue to a range of $11.7 billion to $12.7 billion, below consensus estimates of $12.49 billion, and projected breakeven adjusted earnings.
"This miss will surely have ripple effects across the sector," Lee said, noting that traders may turn to products such as the Direxion Daily Semiconductor Bull 3X ETF (NYSE:SOXL) and Direxion Daily Semiconductor Bear 3X ETF (NYSE:SOXS) to express bullish or bearish views on the broader semiconductor space. SOXL is down around 3% while SOXS is up 3% on Friday.
Execution And Policy Risks Remain In Focus
Intel CEO Lip-Bu Tan acknowledged execution challenges, emphasizing the need to improve production yields. Lee also flagged rising memory prices and U.S. government involvement as potential sources of volatility later this year.
As earnings season unfolds, leveraged ETFs tied to Intel and the broader semiconductor sector are once again serving as high-frequency sentiment gauges, revealing not just where traders are positioned, but how quickly conviction can change.
Photo: Piotr Swat via Shutterstock
