The personal computer market was in focus on Tuesday following a news report saying that Intel (INTC) is cutting prices for the latest processors due to declining PC sales. Intel stock declined on Tuesday.
Taiwan-based DigiTimes reports that Intel is cutting prices for processing units at the Alder Lake center because orders from PC makers for the second half of 2022 are “weaker than expected. due to a decline in PC demand. ” The chipmaker launched those new processors, known commercially as Intel’s 12th Generation Core CPUs, in November.
Intel declined to comment on the report.
DigiTimes says Intel cut the price for Alder Lake chips by 8% to 10% this quarter, with another mid-single digit price cut possibly set for the third quarter.
“If accurate, we can see this result for Intel and AMD,” Wedbush Securities analyst Matt Bryson said in a note to clients. Advanced Micro Devices (AMD) competes with Intel on PC processors.
Intel Stock, AMD Stock Fall
Bryson rated Intel stock underperforming with a target price of 44. He rated AMD stock as outperform with a target price of 165.
In afternoon stock market trading today, Intel stock declined 0.8% to 38.31. AMD stock fell 5.5% to 81.46.
Loop Capital Markets analyst Ananda Baruah said the PC market is a bit chaotic right now.
“We noticed a clear difference between commercial IT (information technology) demand and the dynamics of consumer IT demand,” he said in a note to clients on Monday. “We have not yet seen any slowdown in commercial demand while there has been a clear slowdown in consumers.”
Hope For Commercial Demand
Even if consumer demand disappears, PC makers Dell Technologies (DELL) and HP (HPQ) continues to be positive in voice about commercial demand, Baruah said.
Intel stock ranks weakly No. 21 of IBD’s 31 semiconductor manufacturing industry group stocks. It has a poor IBD Composite Rating of 32 out of 99, according to the IBD Stock Checkup.
AMD’s rival stock ranks sixth out of 33 stocks in IBD’s fabless semiconductor industry group, with a CR of 71.
Meanwhile, Dell stock fell 1.3% to 49.60 Tuesday afternoon. HP stock retreated 1.6% to 34.80.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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