Intel Q1 2025 earnings preview: what to expect as tariff fears drive temporary demand surge

​​​Why Intel's Q1 results could be boosted in the short-term 

​Intel's upcoming first-quarter (Q1) earnings report is expected to show a temporary boost in performance, primarily driven by customers rushing to purchase PC chips before potential Trump-era tariffs take effect. This artificial demand surge could mask underlying weaknesses in the company's broader business segments and create a false impression of sustainable growth. 

​The anticipated tariffs have prompted many manufacturers to accelerate their chip purchases, creating what analysts describe as "pull-forward" demand. This temporary spike in buying activity is expected to boost Intel's immediate results but potentially create a vacuum in future quarters once customers have satisfied their stockpiling needs. 

​Industry data confirms this trend, showing PC shipments increased by 4.9% in recent months, a move largely attributed to concerns about impending tariffs rather than genuine market growth. This artificial demand inflation raises serious questions about Intel's ability to maintain momentum beyond the current reporting period. 

​Client computing segment faces mixed outlook despite tariff-driven purchases 

​Intel's client computing group, which primarily focuses on PC processors, is still projected to see a year-over-year (YoY) revenue decline of approximately 9% despite the pre-tariff buying surge. This persistent decline highlights the structural challenges facing Intel's core business that even temporary demand boosts cannot overcome. 

​Notebook chip sales are expected to show modest growth. However, this incremental improvement falls significantly short of offsetting the broader weakness across Intel's product portfolio and represents a one-time event rather than a sustainable recovery. 

​The artificial nature of this demand surge raises concerns about inventory levels throughout the supply chain. As customers stockpile chips ahead of potential tariffs, they may significantly reduce future orders once these inventories are established, creating additional headwinds for Intel in subsequent quarters. 

​Analysts warn that the current buying activity could create a "glut" of inventory that will need to be worked through before normal purchasing patterns resume. This inventory overhang threatens to depress Intel's sales performance well beyond the current quarter, potentially creating extended weakness in what is already a challenging business environment.

​Server segment continues to underperform amid intense competition 

​While PC chip sales may show temporary resilience, Intel's server segment continues to struggle against fierce competition from rivals like Advanced Micro Devices (AMD). The company's data centre business faces persistent challenges in maintaining market share against more technologically advanced competitors. 

Server chip sales, once Intel's most profitable and fastest-growing segment, have experienced significant pressure as enterprise customers increasingly adopt alternative solutions. This structural shift in the server market represents a fundamental challenge to Intel's long-term business model that temporary boosts in consumer segments cannot compensate for. 

​The server market's importance extends beyond its direct revenue contribution, as it typically generates higher margins than consumer products. Weakness in this segment therefore has a disproportionate impact on Intel's profitability, even if overall revenue remains relatively stable due to temporary factors in other business lines. 

Analysts expect server-related revenues to remain under pressure in Q1 and beyond, creating an ongoing drag on Intel's financial performance that may offset any short-term gains from pre-tariff buying activity. This segment's weakness represents a significant strategic challenge that will require substantial technological innovation to address. 

Potential impact on Intel's share price and investor sentiment 

​Intel's shares have already experienced significant pressure, falling 3% in recent trading amid broader technology sector weakness. The stock has underperformed dramatically over the past year, declining by 46.6% compared to substantial gains in major indices like the S&P 500 and Nasdaq 100. 

​This persistent underperformance reflects investor scepticism about Intel's ability to successfully navigate its technological and competitive challenges. While pre-tariff buying may create a temporary boost in Q1 results, the market appears unconvinced that this represents any meaningful change in Intel's long-term trajectory. 

​Analyst consensus currently rates Intel stock as a "Hold," with a modest price target of $24.62, indicating limited expected upside from current levels. This cautious outlook suggests that even a better-than-expected Q1 report may not significantly change investor perceptions without evidence of more sustainable improvement. 

​For traders and investors considering positions in Intel ahead of its earnings report, the artificial nature of current demand makes forward guidance particularly crucial. Management commentary about expected post-tariff demand patterns will likely have more impact on the share price than the Q1 results themselves. 

​How tariff concerns may affect future quarters 

Perhaps the most significant concern for Intel is the potential for weaker-than-expected performance in quarter two (Q2) and beyond as the artificial demand boost dissipates. Analysts widely expect that the current pull-forward purchasing will create a corresponding demand vacuum once customers have established sufficient inventories. 

​This expected weakness in future quarters could lead to disappointing guidance when Intel reports its Q1 results. Management will likely need to acknowledge the temporary nature of current demand and prepare investors for a potential decline in sequential performance as the market normalises. 

​The tariff-related buying surge also complicates Intel's inventory management and production planning. The company must carefully balance meeting current elevated demand without creating excess capacity that becomes underutilised once the artificial buying pressure subsides. 

​Investors using spread betting or CFD trading to speculate on Intel's performance should remain aware of this potential volatility as the market adjusts to more normalised demand patterns following the tariff-related distortion. 

​Intel stock price – technical analysis 

​Intel’s miserable performance in 2024 continued into the new year. Despite rallies in February and March, the price has failed to sustain any move higher.  

​The one crumb of comfort for the bullish view would be that the price is holding the $19.00 area as support, as it did in 2024. The recent tariff volatility took the price briefly below this zone of support, but it is just about holding so far.  

​If it is firmly broken to the downside then the 2010 low at $17.66 comes into view. Below this comes the 2009 low at $12.15.  

Intel share price chart

​Long-term strategic challenges remain despite temporary boosts 

​Beyond the immediate impact of tariff-related demand, Intel continues to face significant strategic challenges in maintaining its competitive position. The company has struggled with manufacturing delays and technological setbacks that have allowed competitors to gain ground across multiple market segments. 

​Intel's difficulties transitioning to more advanced manufacturing processes have created persistent competitive disadvantages against rivals with more agile production capabilities. These fundamental challenges remain unresolved despite recent management changes and strategic refocusing efforts. 

​The company's long-term growth strategy depends heavily on successfully expanding beyond its traditional CPU business into areas like discrete graphics, networking, and AI accelerators. Progress in these diversification efforts has been mixed, with significant investments yet to translate into market-leading positions. 

​For investors considering a longer-term position in Intel, these strategic considerations likely outweigh the temporary impact of tariff-related demand patterns. The company's success in addressing its fundamental technological and competitive challenges will ultimately determine its ability to deliver sustainable shareholder value. 

​How to trade Intel's Q1 2025 earnings 

1. ​Do your research on Intel's recent performance and analyst expectations for the upcoming earnings report. Pay particular attention to guidance for future quarters given the artificial nature of current demand. 
2. ​Choose whether you want to trade or invest based on your analysis of Intel's prospects and your personal risk tolerance. 
3. ​Open an account with us if you haven't already done so, providing the necessary identification and funding. 
4. ​Search for Intel (ticker: INTC) in our platform or app and review the available trading options, including potential leveraged positions through CFDs or more traditional share ownership. 
5. ​Place your trade based on your market outlook, ensuring you've set appropriate stop-loss orders to manage risk given the potential volatility around earnings announcements.