Should You Trim Or Add To Your Intel Position Now

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Intel (INTC) shareholders face an awkward choice. The stock lost 24.9% in the month to October 21, 2026, while the S&P 500 was about unchanged. Yet management said fiscal Q2 2026 was the seventh straight quarter in which Intel exceeded its own financial expectations. The business is improving, but the company is also spending heavily on its factories and has sold new shares. So what exactly are buyers paying for at today's price?

Intel Buyers Are Paying For Data Center Growth

Intel posted data center revenue of $6.3 billion in fiscal Q2 2026, up 59% from a year earlier. Management said demand for the company's products continues to outpace its growing supply.

Buyers are paying well above the market for that growth. At the October 21 close, Intel stock traded at 8.3 times its sales over the last twelve months, compared with 3.1 times for the S&P 500. The share price climbed 144% over the past year. The share price rose far faster than twelve-month revenue, which grew 7.5%. Because the company reported a net loss over those twelve months, Intel's price-to-earnings ratio is not meaningful.

Profit is improving from a low base. Intel recorded an operating margin of 12.2% in fiscal Q2 2026, up from an operating loss of 10.0% of sales a year earlier in fiscal Q2 2025. Over the last twelve months the margin was 7.6%, still well short of the 18.5% for the S&P 500.

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Are Outside Customers Keeping Up With Intel's Factory Spending?

Not yet. Intel Foundry, the company's chip-making arm, lost $2.1 billion at the operating level in fiscal Q2 2026, while outside customers brought it $293 million of revenue. That loss was $348 million smaller than in the prior quarter. Management said output on Intel 18A, its newest manufacturing process, ran about 25% above target.

Intel is spending more on its factories even so. Management raised its 2026 capital spending outlook to more than $20 billion and expects 2027 spending to be well above that. On the July 23 call, management also said the company may need to tap the capital markets for more investment if it is very successful.

On August 11, Intel raised the size of a stock offering to $20 billion, selling 210.5 million new shares at $95 each. Those shares add about 4% to the diluted share count Intel had in late June. The stock closed at $92.96 on October 21, below the price those new buyers paid. For now, outside foundry customers are small next to what Intel is spending on its factories.

How Far Has Intel Fallen In Past Market Shocks?

It has fallen further than the S&P 500 in four of the five recent shocks. During the 2022 inflation shock and Fed tightening, Intel stock fell 52% against 24% for the index. During the 2023 SVB regional banking crisis, it dropped 13% against 6.7%. The stock fell 45% during the 2024 yen shock, compared with 7.8% for the S&P 500, and lost 30% during the 2025 US tariff shock, against 19%. The one exception was the 2023 five percent yield shock, when Intel declined 4.3% while the index fell 9.5%.

What Would Make Intel's Risk Worth Taking?

Intel's data center sales would need to keep growing, and Intel Foundry would need more outside customers while its loss keeps shrinking. Intel is expected to report fiscal Q3 2026 results in October 2026, measured against management's revenue guide of $15.8 billion to $16.8 billion. Data center revenue and the foundry's operating loss are the numbers to watch in that report.

Is Too Much Of Your Wealth Riding On One Stock?

A move like this makes Intel holders ask whether to add or step back. When one position grows into a large part of your wealth, a sharp fall can hurt your whole plan, and selling to spread the money out can bring a large tax bill. Our partner advisory firm offers a free strategy review of ways to protect a concentrated position and unwind it with less tax.

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