Intel’s robust report is seemingly a rising tide that lifts all boats in the industry, not just a company-specific dynamic.
Arm recently pivoted to designing and selling CPUs for data center customers (like Meta!) in addition to its long-standing business of licensing out the design architecture.
And AMD, of course, has been a well-established giant in the space before it ever started offering GPUs.
It’s the latest reminder that the AI boom isn’t just juicing demand for the most advanced chips, but also memory, older-school units, and a wide array of hardware.
Intel shares surged in after-hours trading Thursday after the semiconductor giant reported much better-than-expected Q1 earnings and sales numbers, as well as robust guidance for Q2.
Intel reported:
Q1 revenue of $13.6 billion vs. a consensus expectation for $12.42 billion.
Adjusted earnings per share of $0.29 vs. the $0.02 consensus estimate from FactSet.
A forecast for Q2 sales of between $13.8 billion and $14.8 billion vs. analysts’ $13.11 billion expectation.
A forecast for adjusted Q2 EPS of $0.20 vs. Wall Street expectations for $0.10.
“The next wave of AI will bring intelligence closer to the end user, moving from foundational models to inference to agentic. This shift is significantly increasing the need for Intel’s CPUs and wafer and advanced packaging offerings,” Intel CEO Lip-Bu Tan said in the company’s earnings release.
The quarterly result was clearly a surprise to both analysts and investors. Shares were up 15% shortly after the report in after-hours trading — despite having risen roughly 50% already in the month of April before the results were released.
Intel’s results could not be more different from the previous quarter. In its Q4 report, Intel issued lackluster guidance for Q1, which it blamed on a dearth of available silicon wafers it could use to make finished chips. The stock plunged 17% the next day.
“Intel was explicit on the Q4 call that they were living hand-to-mouth on wafers,” Cody Acree, a senior semiconductor analyst at brokerage firm Benchmark/StoneX, said in a brief phone interview with Sherwood News Thursday. “If this kind of upside was possible, than why the ultraconservative guidance?”
The Q1 results are a significant coda to what has been one of the best periods of share price performance for the company in decades. The stock has more than tripled over the last 12 months.
That run-up, however, had seemed to far outpace Intel’s actual business results, resulting in a nosebleed-inducing forward price-to-earnings valuation nearly 100x expected earnings over the next 12 months, dwarfing even the valuations the company was receiving during the peak of the dot-com boom of the 1990s. But the Q1 numbers suggest the market was picking up good vibrations that seem to have been borne out.
Drivers can breathe a small sigh of relief... for now. The national average gas price has gone down $0.06 since last week to $4.03 per gallon, according to the American Automobile Association.
The national average was at $4.09 per gallon a week ago.
Meanwhile, US crude oil prices have gone under $100 per barrel, which has played a part in helping drive down the cost of gas for customers. But how long the downward trend will continue remains uncertain due to instability along the Strait of Hormuz.
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(Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.)
Gas prices are currently the highest they’ve ever been this time of the year going back to 2022, when the national average was $4.11 on April 23.
Meanwhile, US crude oil prices have gone under $100 per barrel, which has played a part in helping drive down the cost of gas for customers. But how long the downward trend will continue remains uncertain due to instability along the Strait of Hormuz.
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(Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.)
Gas prices are currently the highest they’ve ever been this time of the year going back to 2022, when the national average was $4.11 on April 23.
Well, here is an absolute banger of a chart from Fundstrat that is sure to simultaneously please and annoy everyone:
Macro data scientist Alex Wang’s chart on the causes of the five best and worst market days during different presidencies demonstrates how much the Oval Office has driven US stock market volatility during President Trump’s second term in office.
My very loose, abstract description of what policymakers do is “try to make things better.” (As for what constitutes “things” and “better,” well, tens of millions of Americans will have to agree to disagree.)
Most of the time, these things the president and Congress pursue are not a massive shock to the financial system, though there’s always a doomsayer warning that something like Obamacare will spell the end for US stocks. And that means most of the time, you can probably expect a positive skew: policymakers will be coming in with stimulus to support the economy and markets in the face of unexpected downside.
Per Fundstrat’s analysis, that clearly hasn’t been the case in the past 15 months. You can look at this one of two ways. Perhaps this period has been a time of such economic stability and impressive earnings growth that some of those other catalysts for massive one-day drops haven’t materialized. We’re blessed to have gotten to enjoy such a solid backdrop! Or you could suggest this is indicative of a fundamentally more activist presidency and more frequent policy decisions that carry higher macroeconomic consequences compared to previous presidencies. We’re doomed to swing wildly based on what we see next on Truth Social!
There have been a lot of wonderful studies released by asset managers on the importance of not missing the 10 best days in the market in any given year. (It’s less often mentioned by folks who have a vested interest in you investing your money about how much better returns would be if you miss the 10 worst days of the year!) The problem is that these sessions are typically clustered so close together that it’s an impossible task to navigate twisted, volatile waters so cleanly.
The upshot: Trump-induced volatility has been noise, with the biggest five losses nearly perfectly canceling out the biggest gains. There’s an underlying non-Trump, mainly AI trend that’s mattered, and that’s probably the main reason the US stock market is where it is.
Rising fuel prices are set to cost Southwest Airlines $1 billion in the second quarter, the carrier said in its investor call on Thursday morning. The airline, which stopped fuel hedging last year, has been rocked by higher prices amid the war in Iran along with the rest of the industry.
“Clearly revenues, and therefore fares, are underneath the increase in fuel. So we’ve not caught the increase in fuel by any any stretch of the imagination,” CEO Bob Jordan said.
Despite its fuel expense, Southwest said its earlier forecast of full-year earnings of $4 per share — which would be more than 4x its 2025 profit — could still happen. When it reported earnings after the bell on Wednesday, the airline declined to update the forecast given “ongoing macroeconomic uncertainty.”
“There are scenarios where absolutely we could still hit the $4. It depends on, you know, fuel and revenue trends from here. We just felt like it was not productive to introduce a new guide or a range, given how volatile fuel is,” Jordan said.
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