Intel’s Israel plant reopens after worst drop since 1974

Intel ↘ 28.58% shares fell 28.58% on Friday, October 30. It was the company's biggest one-day drop since July 1974, and it wiped about $140 billion off its market value in a single session, Chosun Ilbo reported. The selloff came after the chipmaker forecast fourth-quarter revenue of $15 billion to $16 billion and adjusted earnings of 25 cents a share. Analysts had expected about $17.07 billion and 43 cents, according to LSEG data cited by Reuters. The quarter Intel had just finished was solid, and that made the outlook harder for investors to take. Third-quarter revenue rose 21% to $16.5 billion, and data center and AI revenue grew 78%, Yahoo Finance reported.finance.yahoo.com+2

Memory squeeze and a factory blast

AI data centers are buying up much of the world's supply of memory chips. That has pushed up PC prices and cut demand for Intel's processors. "Our customers began signaling a PC slowdown based on the memory prices and availability," CEO Lip-Bu Tan said, according to IBTimes. Intel expects PC shipments to fall about 12% this year and about 10% in 2027. It also expects revenue from its PC chip unit, which brought in $8.1 billion last quarter, to fall more than 20% from the previous quarter, The Wall Street Journal News Corp ↘ 1.37% and Yahoo Finance reported.hk.ibtimes.com+2

A gas explosion at Fab 28, Intel's plant in Kiryat Gat, Israel, also hurt the forecast. The blast killed two workers and shut the plant for two weeks. CFO David Zinsner told Reuters it would cut fourth-quarter revenue by about $300 million and gross margin by about 200 basis points, with a similar revenue hit expected in the first quarter.reuters.com

Wall Street cuts targets, chip stocks slide

Bank of America downgraded Intel to neutral and cut its price target to $100 from $145. Bernstein cut its target to $75 from $110, and UBS lowered its target to $80 from $100, CNBC reported. Bernstein's Stacy Rasgon called the outlook "(in a word) terrible," The Oregonian reported.cnbc.com+1

Other chip stocks fell with Intel. The Philadelphia Semiconductor Index PHLX Semiconductor Index ↘ 7.18% dropped 7.2%, AMD Advanced Micro Devices, Inc. ↘ 10.88% fell 10.88%, and the Nasdaq Composite lost 2.86%, according to Chosun Ilbo. In Seoul, the Kospi fell 3.48% on October 30, triggering a sell-side circuit breaker. SK Hynix ↘ 7.95% dropped 7.08% and Samsung Electronics fell 3.02%, the paper reported.chosun.com

Anxiety in Israel

Fab 28 resumed production on Sunday, November 1. Even so, some of Intel's roughly 8,000 workers in Israel fear a new round of layoffs, Ynet reported. About 1,000 Israeli employees lost their jobs between late 2024 and early 2025. "We thought we'd already made it through the difficult period," one Kiryat Gat employee told Ynet.ynetnews.com

Intel said in a statement that the drop reflected "specific, temporary challenges that do not change the company's direction." The company added that "hasty conclusions should not be drawn about the company's condition based on fluctuations reflecting market sentiment," according to Ynet.ynetnews.com