• Intel (INTC)'s five-year credit default swap spread jumped to a record 123.5 basis points, marking the biggest one-day move since October 2022, according to Markit (SPGI) data.
  • The move follows a gloomy fourth-quarter outlook that sent shares down more than 20% after hours, despite strong third-quarter revenue growth.
  • The widening CDS signal reflects growing investor anxiety over Intel's ability to fund its costly turnaround, not an imminent default.

A Sharp Repricing of Risk

Intel's credit default swaps widened to 123.5 basis points on Thursday, a record high for the company and the largest single-day increase since October 2022, according to Markit data. The move means investors are demanding more compensation to insure against an Intel default, with the annual cost of protection now at roughly 1.235% of the insured amount, or about $123,500 per year on $10 million of debt.

The trigger was Intel's fourth-quarter guidance, issued after the close on Wednesday, which fell well short of analyst expectations. The chipmaker projected revenue of $15 billion to $16 billion and adjusted earnings of $0.25 per share, versus consensus estimates of $17.1 billion and $0.43, according to LSEG (LSEG.L) data. Shares plummeted more than 20% in after-hours trading.

Strong Sales, Weak Outlook

The weak forecast overshadowed a solid third quarter. Intel reported revenue of $16.51 billion, up 21% year over year, with net income of $3.32 billion, or $0.60 per share on a GAAP basis. Adjusted EPS came in at $0.52. Data-center and AI revenue surged 78% to roughly $7.3 billion, while client computing revenue slipped 5% to about $8.1 billion.

The divergence highlights Intel's dual challenge: booming demand for AI server chips, but a PC market that is slowing and component prices that are rising. Management expects the PC downturn to persist through at least the first half of 2027.

Adding to the pressure, an explosion at an Israeli factory earlier this month has forced an extended shutdown. The incident killed two workers and seriously injured a third, and CFO David Zinsner estimated it would cost about $600 million in lost revenue over two quarters.

Capital Cushion vs. Credit Worries

Intel has bolstered its balance sheet with significant capital raises recently. Nvidia (NVDA) completed a $5 billion equity investment in December 2025, and the U.S. government took an approximately 10% stake in 2025. The company also completed a $23 billion equity offering in August 2026. Those moves provide substantial liquidity, but they also dilute existing shareholders.

"The market is repricing Intel's credit risk to reflect a more uncertain path to sustainable free cash flow," said one credit analyst who asked not to be named. "The CDS level is still far from distressed territory, but the direction is concerning."

Intel did not respond to a request for comment.

The Road Ahead

CEO Lip-Bu Tan, who took over in March 2025, has been restructuring the company, cutting jobs and streamlining the product portfolio. He has said he expects to announce a couple of foundry customers within the next two quarters—a key milestone for validating Intel's manufacturing strategy. The company's advanced 18A process is in high-volume production in Arizona, but it has yet to land major external customers.

For now, the widening CDS spread serves as a warning signal from credit markets. It does not indicate an imminent default, but it underscores that Intel's turnaround remains a work in progress, with investors demanding a higher premium for the risk.

Correction: An earlier version of this article misstated the year of Nvidia's equity investment. It was completed in December 2025, not 2024.