By Kara Greenberg

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Intel shares tumbled Friday, threatening to wipe out most of the chipmaker’s stock gains this year

Intel (INTC) shares plunged Friday, a day after the chipmaker reported quarterly sales that topped estimates, but posted a loss as it works to engineer a turnaround under the leadership of new CEO Lip-Bu Tan.

Shares were down over 7% in premarket trading, threatening to wipe out most of the chipmaker’s stock gains this year.

“There clearly is a better level of discipline at the company under the new CEO but some of these problems may not be fixable,” Jefferies analysts told clients following the results.

“There was no real sense that INTC has turned the corner” in its PC and service businesses, the analysts said, and voiced concerns that Intel’s changes have been “more incremental than sweeping” so far, with a “lack of competitive products until next year."

They maintained a “hold” rating for the chipmaker’s stock, preferring to sit on the sidelines for now. Analysts at Citi and HSBC also reiterated neutral ratings in the wake of Intel’s earnings call, citing uncertainty around its turnaround efforts. HSBC called Intel's results and outlook "uninspiring" in a Friday note.

"It’s going to take time, but we see clear opportunities to enhance our competitive position, improve our profitability and create long-term shareholder value,” Tan told investors Thursday.

As part of its cost-saving measures, Intel said it plans to lay off more employees, trimming 15% of its workforce. The chipmaker said it is also halting planned projects in Germany and Poland, as well as slowing the construction of its new chipmaking facilities in Ohio.

Source: Investopedia