Jim Cramer on Intel: "It Didn't Predict the Strength of Its Own Markets Correctly"

Intel Corporation (NASDAQ:INTC) is one of the stocks Jim Cramer talked about, along with the memory shortage. Cramer noted the company’s “dismal guidance,” as he commented:

Finally, when Intel reported last Thursday, the stock got clobbered. Remember… it was down 17% on Friday, another 5% on Monday, before stabilizing today. That’s not because the numbers were bad. The quarterly results were actually quite good. Instead, Intel gave dismal guidance because they just don’t have the ability to meet the demand for their chips. From my own reporting, I’ve found out that Intel simply doesn’t have enough manufacturing equipment. It didn’t predict the strength of its own markets correctly.

Intel Corporation (NASDAQ:INTC) designs and manufactures processors, chips, memory, and related hardware. Additionally, it provides software, optimization solutions, and AI-enabled platforms. Cramer mentioned the stock during the January 3 episode and said:

Last night, Intel reported a decent enough quarter but offered distinctly suboptimal guidance for the current quarter, which it said was totally because of the CPU shortage. Remember, anything that goes into a PC or server is in short supply, thanks to the data center boom. So Intel can’t make enough CPUs to truly profit from the shortage. They planned wrong. They were caught unawares. It happens, but that’s why the stock got obliterated today, down 17%.

They didn’t factor in the storage correctly. There was just too much shortage, just way more than they thought… Intel’s slide was so bad that it dragged down the memory chip makers. Pure guilt by association, but that’s ridiculous. Intel doesn’t have a problem with demand. They said we can’t produce enough supply. The industry’s in great shape. This is just one company with lackluster execution and no more than that. I think Intel’s still a great company. It’s come back under Lip-Bu Tan. I think it’s going to take advantage of the CPU shortage, and I do believe that Lip-Bu can fix what’s ailing the company. It was a very broken company when he came in.

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Disclosure: None. This article is originally published at Insider Monkey.