Intel (INTC) is in a tough spot this week after the U.S. rolled out new export rules that hit some of its most advanced AI chips, sending the stock down. The company has already told its Chinese clients that it will now need a special license to ship certain processors, according to the Financial Times.
These restrictions, set by the Trump administration, point to rising U.S.-China tensions that are now hurting big chipmakers like Intel, Nvidia (NVDA), AMD (AMD), and ASML (ASML), among others.
Intel’s Gaudi Chips Hit by New Export Restrictions
The new rules apply to chips with very high memory or data transfer speeds. That puts Intel’s Gaudi series right in the middle of the crackdown. These chips are used for AI tasks and compete with Nvidia’s products, which are also affected by similar restrictions. It’s important to highlight that Intel generates a significant portion of its revenue from China, making it a key market for the company. So, any such restrictions could take a toll on its earnings.
Just a day earlier, Nvidia warned it could lose up to $5.5 billion in revenue because of these export limits. Meanwhile, Dutch chip equipment maker ASML also expressed concerns about its future outlook due to rising tariffs during its Q1 conference call. CEO Christophe Fouquet cautioned that Trump’s uncertain tariff plans could pull ASML’s full-year revenue towards the low end of its expectations.
At the same time, AMD warned it could face up to $800 million in charges due to the new U.S. rules, tied to unused inventory, canceled purchase deals, and financial reserves.
Chip Stocks Take a Hit
The broader chip industry is under growing pressure as these trade rules tighten, leading to significant stock losses for major players. Intel has already seen its stock plummet by nearly 46% in the past year, with a 3.12% drop on Wednesday alone.
At the same time, Nvidia, AMD, and ASML each dropped about 7% yesterday, showing just how wide the fallout is from these new rules.
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 27 Holds and four Sells assigned in the past three months, as indicated by the graphic below. The average INTC price target of $23.00 per share implies 19.60% upside potential.
