S&P Global downgrades Intel's credit rating on slow recovery, management changes

S&P Global Ratings has downgraded Intel Corp’s credit rating from ‘BBB+’ to ‘BBB’, attributing the decision to a slower than anticipated business recovery and uncertainty brought about by recent management changes. The ratings agency noted that Intel’s revenue for the first nine months of the year, totaling $38.84 billion, which was virtually unchanged year-on-year, fell below expectations. Additionally, the unexpected departure of CEO Pat Gelsinger introduced further instability, given his critical role in the company’s integrated manufacturing strategy and the ongoing execution of a turnaround plan.

Despite Intel assuring that the business strategy will remain largely unchanged, S&P Global anticipates some level of change under the new CEO, which could potentially impact the timing of the planned business turnaround. The agency pointed out that Gelsinger’s departure precedes the completion of his four-year plan to regain Intel’s leadership in the production of fast and small computer chips. However, S&P Global maintained its “stable” outlook for Intel, projecting growth after a modest recovery in the coming year.

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