S&P Dow Jones Indices announced Friday that Intel will lose its place in the Dow Jones Industrial Average after 25 years with Nvidia. This was the latest blow to the struggling semiconductor maker, which was one of the first two technology companies included in the blue-chip list. index.
Intel, once the champion of chip manufacturing, has missed the generative artificial intelligence boom in recent years due to missteps such as ceding manufacturing dominance to rival TSMC and transferring its investment in OpenAI, owner of ChatGPT.
Intel's stock price has fallen 54% this year, making it the index's worst performer and the lowest on the weighted Dow Jones Industrial Average.
Shares fell about 1% to $22.79 in extended trading Friday, while Nvidia rose more than 2% to $139.17.
The development comes as Intel expressed optimism about the future of its PC and server business, predicting better-than-expected revenue this quarter but warning that there is “much work to do.” It was held the next day.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “Losing Dow Jones membership would be a further blow to our reputation as Intel faces a painful transformation and loss of credibility. It will be a blow to the.''
“It also means Intel is not included in an exchange-traded fund (ETF) that tracks the index, which could further impact the stock price.”
Founded in 1968, the Silicon Valley pioneer sold memory chips before switching to processors, which helped launch the personal computer industry.
In the 1990s, “Intel Inside” stickers transformed commodity electronic components into premium products, eventually making their way into laptops.
Intel's Revenue was $54 billion Revenue in 2023 was down nearly a third from 2021, when Pat Gelsinger took over as CEO. Analysts expect Intel to report its first annual net loss since 1986 this year.
The company's value fell below $100 billion for the first time in 30 years.
This pales in comparison to Nvidia, the second most valuable company in the world with a valuation of $3.32 trillion.
Nvidia's AI Lead
Nvidia has emerged as a cornerstone of the global semiconductor industry thanks to the key role its chips play in driving generative AI technology, which has seen its stock price soar sevenfold over the past two years.
The company's stock price has more than doubled this year alone.
Once popular only among gamers looking for PCs with Nvidia's graphics processors, the company is now the second most valuable company in the world and considered a barometer of the AI market.
The company's 10-for-1 stock split that took effect in June also helped pave the way for its addition to the index, making the company's soaring stock more accessible to individual traders.
Meanwhile, Intel is gaining share in the AI chip market dominated by Nvidia, as front-runner chips are difficult to obtain and even harder to replace in AI data centers due to the technological superiority and high cost of its processors. I'm having a hard time getting it. About replacing them.
