Intel ceases 5G mobile chip development after Apple announcement

Intel stock (NASDAQ:$INTC) was down last Friday on the heels of the company’s earnings report released the day prior.

The tumble marked the largest in the company’s stock since 2016.

Earnings Projection Cools Down

Intel reportedly beat analyst expectations, coming in 2 cents above analysts’ average forecast of 87 cent profit per share. Despite this positive performance, the company adjusted down its earnings guidance for the first time since announcing its withdrawal from the 5G race.

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Intel lowered its earnings expectations for 2019 by 2.89%, or $2.05 billion. This blemish on otherwise positive earnings drove Intel stock down a precipitous 9% from Thursday to Friday.

Industry competitor Qualcomm recently announced its settlement of a lawsuit with Apple for an undisclosed sum of funds. The sour relationship the two companies had amid the ongoing legal dispute are set to brighten as Qualcomm returns to being Apple’s chip supplier, in what could be a significant blow to Intel’s future growth plans.

As reported, the deal may have come as Apple felt dissatisfied with Intel’s chip performance.

Earlier this month, Qualcomm unveiled its new 5G-capable chips, tailor-made with edge computing in mind.

Qualcomm also Declines

Qualcomm was not immune to underwhelming earnings, however.

When the company released its report Wednesday of this week, shares fell more than 4% after hours. This came in a similar pattern to Intel’s decline: earnings beat expectations, but the stock declined after guidance expectations were lower than expected.

“We are executing well on our strategic priorities as 5G commercial launches begin around the world. Our 5G technology…as well as our expansion into new industries and product categories, creates a strong foundation for long-term revenue and earnings growth,” Qualcomm CEO Steve Mollenkopf said in a press release.

Intel Continues Focus on Processing Power

As the industry leader in PC processing power, Intel’s latest corporate moves have been to orient the company toward ongoing improvement in this department.

Late last year, the company introduced Foveros 3D chip stacking technology—an industry-first method of stacking processor components.

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