Two tech stalwarts fail to impress Wall Street

Business

Tech companies have been an investor favorite during the pandemic. But Wall Street is keeping its distance from two industry stalwarts after their latest earnings reports.

Intel (INTC) beat full-year revenue expectations, hauling in a record $77.9 billion last year and announcing that it would boost its quarterly dividend to reward shareholders.

But investors still weren’t sold, as worries persist that the company is lagging behind competitors in producing the most advanced microprocessors while struggling with manufacturing delays. Incoming CEO Pat Gelsinger said on a call with analysts that Intel would consider outsourcing more production.

Watch this space: Intel made the decision to release its results just before markets closed on Thursday following reports of unauthorized access to its earnings materials. It’s investigating the breach.

Shares jumped late Thursday, finishing the session 6.5% higher. They’re now down 4.5% in premarket trading.

IBM (IBM), meanwhile, missed revenue estimates. The 109-year-old company is betting big on cloud computing technology, and previously announced it would spin off a significant part of its business in order to double down. In the meantime, CEO Arvind Krishna said Covid-19 anxiety is weighing on sales.

“Our performance reflects the fact that our clients continue to deal with the effects of the pandemic and broader uncertainty of the macro environment,” he said Thursday.

Shares are off 8% in premarket trading.