Intel (NASDAQ: INTC) stock had a banner year in 2023, but it wasn't because of the company's performance. Investors ignored both a dividend cut and its weak results during a cyclical slowdown in PC sales, and instead bet that the legacy chip stock would be among the winners in the new generative artificial intelligence (AI) revolution.

Intel's first earnings report in 2024 seems to be casting doubt on that thesis after the stock fell 12% on Friday. The diversified chip designer and manufacturer actually beat estimates in its fourth-quarter report. Revenue rose 10% to $15.4 billion, ahead of the consensus at $15.16 billion, while adjusted earnings per share jumped from $0.15 to $0.54, topping expectations at $0.45.

If Intel had stopped there, the stock might have gained, but its first-quarter guidance showed that this momentum is grinding to a halt. For the current period, the company expects revenue of $12.2 billion to $13.2 billion, which represents 15% growth at the midpoint from a weak performance a year ago, but is considerably worse than the consensus at $14.1 billion. It also forecast adjusted earnings per share of just $0.13 for the current quarter, below estimates of $0.33.

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Source Fool.com