Tech Weekly: Tech Stocks Tumble on Intel's Guidance Gap

This week's tech sector performance

High-risk tech stocks underperformed safe havens like gold on a myriad of geopolitical stressors this week, including US President Donald Trump’s escalating tariff threats over control of Greenland, anticipation of a collision between Trump and EU leaders at the World Economic Forum in Davos and the sudden announcement of a snap election in Japan.

US markets were closed for MLK Day on Monday (January 19), but futures dropped as tariff fears hit global markets after Trump’s January 17 announcement of additional levies on eight European nations unless the US was allowed to purchase Greenland. European indices were in the red, although defence stocks outperformed amid heightening Arctic tension. In Canada, technology stocks and heavyweight financials led a retreat from last week’s all-time highs.

US trading opened weak on Tuesday (January 20), with tech stocks leading Wall Street futures to one-month lows. Additionally, the CBOE Volatility Index spiked to a two-month high of 20.99 before settling at around 20.09. S&P/TSX Composite Index (INDEXTSI:OSPTX) tech also dropped from records, alongside financials. The S&P 500 (INDEXSP:.INX) shed over two percent at the closing bell, erasing YTD gains.

The tech sector experienced a rebound on Wednesday (January 21) following Trump’s Davos address, where he de-escalated trade tensions by announcing a “framework” deal with NATO regarding Greenland. This geopolitical relief, coupled with solid US GDP revisions and resilient jobs data, fueled a two-day recovery. The tech sector initially led the charge, buoyed by anticipation of Intel's (NASDAQ:INTC) Q4 results; however, the rally hit a wall after the bell on Thursday (January 22) when the chipmaker’s disappointing guidance sent shares tumbling.

On Friday (January 23), the market saw a mixed and somewhat cautious session, with the Nasdaq closing the day in positive territory, bolstered by a surprise revision in the University of Michigan Consumer Sentiment Index, but down for the week.

3 tech stocks moving markets this week

1. Intel (NASDAQ:INTC)

After a Wednesday rally ahead of the company’s Q4 report, shares of Intel fell by over five percent on Friday, wiping out over US$30 billion in market value.

Q4 revenue declined 4.1 percent YoY to US$13.7 billion. Additionally, a dismal Q1 2026 outlook sparked a sell-off and reignited fears of broad-based supply constraints. During the earnings call, Intel projected a loss of US$0.21 per share for the coming quarter, citing supply chain bottlenecks and a supply crunch that CEO Lip Bu Tan said could prevent the company from meeting the demand for AI server chips.

“In the short-term, I am disappointed that we are not able to fully meet the demand in our markets,” Tan said. “My team and I are working tirelessly to drive efficiency and more output from our fabs, and while yields are in line with our internal plans, they are still below where I want them to be.

“Accelerating yield improvement will be an important lever in 2026 as we look to better support our customers.”

The company closed at US$45.09 per share in Friday, a 3.98 percent dip for the week.

2. Alibaba (NYSE:BABA)

Meanwhile, Alibaba emerged as one of the week’s biggest winners, capitalizing on the thaw in US-China trade tensions signaled at Davos after the country’s Vice Premier He Lifeng called for “win-win cooperation” and multilateralism, leading analysts at Arete Research to upgrade the stock to a “Buy” with a US$190 price target.

The stock surged over 4.73 percent for the week, outperforming some of its US big-tech peers and briefly reaching a price point above US$180.

Two additional drivers fueled the rally: first, reports emerged on Thursday that the company is laying the groundwork for an IPO of its AI chip unit, T-Head, which JPMorgan reportedly estimates could be valued at up to US$62 billion.

Later, sentiment was further bolstered by news that the Chinese government would allow local tech giants to order high-end NVIDIA (NASDAQ:NVDA) H200 chips. Shares of Nvidia also rose, and the company briefly crossed the US$5 trillion market cap milestone, becoming the first company in history to do so.

3. Meta Platforms (NASDAQ:META)

Meta shares rallied 4.67 percent between Thursday and Friday, rebounding from a one-month low to reclaim a US$1.6 trillion market cap.

The stock was buoyed on Wednesday by the announcement of a global rollout of advertising on Threads as well as support from major Wall Street analysts.

Jefferies reiterated its “Buy” rating and a US$910 price target, highlighting an “attractive risk-reward profile” and a significant valuation discount compared to peers like Alphabet.

Meanwhile, Stifel maintained its “Buy” rating while adjusting its price target to US$785, down from US$875, noting that while AI-related infrastructure costs are rising, Meta remains a top pick due to strong advertising momentum from Instagram Reels.

Top tech news of the week

• Independent investment bank and financial services firm William Blair initiated coverage on memory-focused semiconductor firms Micron Technology (NASDAQ:MU), Rambus (NASDAQ:RMBS:US) and Silicon Motion this week with an “Outperform” rating on all three. Analyst Sebastien Naji noted that while AI processors have dominated the spotlight, the “traditionally slower-growth” memory market is entering a supercycle.

• Intuitive Surgical (NASDAQ:ISRG), a developer of robotic systems for the medical industry, gained ground on Friday after its quarterly financial results exceeded expectations. The company reported Q4 revenue of US$2.87 billion, 19 percent growth year over year.

• British Columbia-based General Fusion announced its intent to go public on the Nasdaq Composite (INDEXNASDAQ:.IXIC) via a US$1 billion SPAC merger with Spring Valley Acquisition, trading under the ticker GFUZ. The company said it aims to be the first “pure-play” fusion company on the market.

Tech ETF performance

Tech exchange-traded funds (ETFs) track baskets of major tech stocks, meaning their performance helps investors gauge the overall performance of the niches they cover.

This week, the iShares Semiconductor ETF (NASDAQ:SOXX) advanced by 0.37 percent, while the Invesco PHLX Semiconductor ETF (NASDAQ:SOXQ) declined by 0.16 percent.

The VanEck Semiconductor ETF (NASDAQ:SMH) also decreased by 0.64 percent.

Tech news to watch next week

Next week, investors will tune in to Federal Reserve Chairman Jerome Powell’s post-meeting remarks for signals on what comes next. The Fed is expected to hold rates at 3.5 - 3.75 percent when its meeting concludes on Wednesday (January 28), with the first rate cut of 2026 not expected until June.

Earnings season will continue next week, with Magnificent Seven stocks Tesla (NASDAQ:TSLA) and Microsoft (NASDAQ:MSFT) set to report on Wednesday, and Apple (NASDAQ:AAPL) reporting its results on January 29.