Intel guidance miss triggers sharp sell-off in Taiwan markets, TSMC dips
Intel's lower-than-expected fourth-quarter outlook drove its shares down nearly 29%, prompting a steep opening decline in Taiwan's weighted index and a 1.9% drop in TSMC shares.
Intel's weak fourth-quarter guidance sent its stock down almost 29% on Friday, marking the steepest one-day fall in more than 50 years and pulling U.S. indexes lower. The news quickly spread to Asian markets, where Taiwan's weighted index opened at 45,034.53 points before falling to an intraday low of 44,399.10, a drop of 812 points.
Bellwether Taiwan Semiconductor Manufacturing Company (TSMC) opened at NT$2,310, later recovering to NT$2,325, a decline of about 1.9% in the morning session. Other notable moves included Hon Hai gaining 2.04% to NT$250.5, MediaTek up 0.77% to NT$3,945, and Delta Electronics down 1.87% to NT$1,310.
In the United States, the Dow Jones Industrial Average fell 1.09% to 51,770.31, the S&P 500 dropped 1.82% to 7,580.07, and the Nasdaq Composite slipped 2.86% to 25,437.00, its biggest single-day decline since early June. The Philadelphia Semiconductor Index plunged 7.20% to 10,688.80.
Intel reported third-quarter revenue of $16.5 billion, up 21% year over year, and adjusted earnings per share of $0.52, both beating its own guidance. However, the company forecast fourth-quarter revenue of $15 billion to $16 billion and adjusted earnings per share of $0.25, both below market estimates of roughly $17 billion and $0.43.
"While the PC industry faces near-term headwinds, CPU demand remains strong and the priority is to expand supply to meet demand for Xeon server processors," Intel CEO Lip-Bu Tan said. The chief financial officer added that weakness in the PC market is expected to continue through at least the first half of next year.
The guidance shortfall triggered a broader sell-off in semiconductor stocks, with AMD down 10.88%, Qualcomm 11.12%, Applied Materials 7.49% and Broadcom 5.48%. Even major tech firms such as Meta, Apple, Alphabet, Microsoft and Amazon posted modest declines.
Analysts noted that trading volume contracted during the sell-off, suggesting the market was not in a panic state, but they cautioned that the Taiwan market remains vulnerable to further moves in U.S. tech stocks and TSMC's performance.