Intel reported third-quarter revenue of $16.5 billion, up 21 percent from a year earlier, then told investors that its PC business is heading for a steep drop. The results came after the market closed on Thursday, October 29, 2026, and the shares fell about 23 percent in after-hours trading to roughly $70.86, according to TradingView.
The headline numbers
Intel's press release and the earnings call transcript give the quarter's figures. GAAP earnings per share were $0.60 and non-GAAP earnings per share were $0.52. Non-GAAP gross margin was 44.1 percent, with a GAAP margin of 43.0 percent, and operating cash flow was $5.1 billion.
The problem was the forecast. For the fourth quarter Intel guided revenue of $15.0 billion to $16.0 billion, non-GAAP earnings per share of $0.25 and a non-GAAP gross margin of 38.0 percent. That is a sharp step down from the quarter just reported.
Where the growth came from
The data centre and AI division carried the quarter, with revenue of $7.3 billion, up nearly 80 percent. Chief executive Lip-Bu Tan said: "Our immediate priority is to unlock additional supply to meet extraordinary demand for our Xeon family."
The client computing and physical AI group, which includes PC chips, brought in $8.1 billion, down 5 percent and below expectations. AI PC revenue grew 35 percent. Intel's foundry unit had revenue of $6.7 billion and an operating loss of $1.9 billion.
Why the PC outlook is bleak
On the call, management said client revenue will fall by more than 20 percent from the third quarter to the fourth as customers cut inventory. It forecast the market for PC units to shrink about 12 percent in 2026 and about 10 percent in 2027.
Memory is the main cause. Chief financial officer David Zinsner said: "We do not expect a sustained recovery until memory availability improves and pricing begins to normalize." In the press release he said the company sees the PC slowdown continuing through at least the first half of next year.
Intel also cited an incident involving gas cylinders at a fab in Israel, which it said would cost roughly $300 million of revenue in the fourth quarter and again in the first quarter of 2027, according to TradingView and the call transcript.
Product progress
Intel said Clearwater Forest, built on its 18A process, is shipping, and Diamond Rapids on 18A-P is sampling. It expects design wins for Nova Lake to be twice those of Panther Lake at launch. The 0.9 version of the process design kit for Intel 14A went to select customers in October.
The call also mentioned plans to buy quantum software firm Classiq. We have only seen that in the call coverage, so treat it as unconfirmed until Intel issues its own announcement.
What the market did
The share drop erased up to $112 billion of market value, TradingView reported. CNBC's headline described a plunge of about 21 percent. Different outlets quote different percentages because they measure at different times after hours, so the final move will only be clear after Friday's regular session.
What it means for laptop buyers
None of the sources states an effect on Indian laptop prices, and Intel gave no regional guidance. The logic is straightforward, though. If memory stays scarce and PC makers cut orders, brands have little room to discount, and that tends to keep prices firm instead of lowering them. That is our inference and not a company statement.
Intel's results also show a split inside the chip market. Demand for server chips tied to AI is outrunning supply, while consumer PCs are the part of the business under pressure. The same memory squeeze that is making phones and cameras more expensive is now visible in a major chipmaker's guidance.
What to watch next
Watch for the full-day share move on Friday, any change to PC makers' own forecasts, memory price trends over the next two quarters, and the first Nova Lake product details. Intel's fourth-quarter report will show whether the client decline matches the more than 20 percent warning.
Published October 31, 2026. Gadgets365 will update this article as more information becomes available.
