Intel's stock fell about 28% on Friday after the chipmaker reported a weaker-than-expected outlook for the fourth quarter, according to the source report. The drop cut about $12 billion from the value of the government's stake, CNBC reports. The source says the Trump administration had the government buy a 10% stake in Intel more than a year ago.
Nvidia, which also took a large stake in Intel in 2025, saw its stock fall slightly on Friday, the report says. The source says much of the tech industry, especially chipmakers, was caught in the sell-off.
Despite the drop, the report says Intel's stock is still up more than 70% for the year. The government and Nvidia remain profitable on their holdings so far, the source says, though the stock has fallen significantly from its highs over the summer.
Intel warned that it expects revenue of $15 billion to $16 billion in the fourth quarter. Analysts had been looking for around $17 billion, the report says. Intel also said its gross profit margin would fall to 37% from 43%. It expects heavy investment to leave it with no positive cash flow.
The report identifies PC sales as the main problem. It says the AI industry is consuming memory and other components, which is pushing up PC prices.