What Happened?
Shares of computer processor maker Intel (NASDAQ:INTC) jumped 6.4% in the afternoon session after reports that CEO Lip-Bu Tan is set to visit the White House, days after President Donald Trump called for his resignation. The meeting follows President Trump's call for CEO Lip-Bu Tan's removal last week over concerns about the CEO's alleged business ties to China. Investors reacted positively, viewing the visit as a crucial opportunity for Tan to address these concerns directly and strengthen Intel's relationship with the administration. The market's optimism may also be fueled by reports that competitors Nvidia and Advanced Micro Devices (AMD) are expected to give the U.S. government a 15% share of revenues from certain chips sold in China. Investors might see this as an opportunity for Intel to differentiate itself and potentially avoid similar penalties, solidifying its position as a primary domestic chip manufacturer.
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What Is The Market Telling Us
Intel’s shares are extremely volatile and have had 32 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 10 days ago when the stock dropped 3.1% on the news that the U.S. jobs report for July came in significantly weaker than expected while new widespread import tariffs were announced, sparking fears of a potential economic slowdown. The U.S. economy added only 73,000 jobs, far below estimates, and massive downward revisions to the prior two months painted a much weaker picture of the labor market. This has stoked recession fears, which would directly impact demand for chips used in countless products. Compounding these worries, the White House announced new tariffs, including a 20% levy on imports from Taiwan, a global hub for chip manufacturing. This dual shock of slowing domestic growth and renewed trade friction creates a challenging outlook for the highly cyclical and globally connected semiconductor industry, leading to a broad-based sell-off.
Intel is up 4.4% since the beginning of the year, but at $21.12 per share, it is still trading 22.9% below its 52-week high of $27.39 from February 2025. Investors who bought $1,000 worth of Intel’s shares 5 years ago would now be looking at an investment worth $438.16.
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