Intel and Reddit grew fast. Why did both stocks fall 29% in a day?
Intel's revenue grew 21%. Reddit's grew 53%. On October 30, 2026, both stocks lost about 29% in a single trading day: Intel closed at $65.76 (−28.6%) and Reddit at $91.73 (−29.2%), measured against the previous day's close. How does a company report that kind of growth and still get punished?
Intel: the margin math
Intel's third-quarter revenue was about $16.5 billion, with data centre and AI revenue up 78% from a year earlier. The problem was the outlook: fourth-quarter revenue of $15 to $16 billion, adjusted EPS of $0.25 and an adjusted gross margin of 38%, down from 44.1% in the quarter just reported.
Q4 midpoint: $15.5B × 38% ≈ $5.9B
Change: about −19%, while revenue falls only about 6%
That's our calculation using rounded company figures, not reported fourth-quarter results. It shows how a small drop in revenue combined with a lower margin produces a much bigger drop in the money left after production costs.
The reasons matter. PC chip revenue fell 5% from a year earlier as higher memory prices squeezed PC demand, while server demand ran ahead of what Intel could supply. Management also estimated that an incident at its Israel factory cut the fourth-quarter outlook by about $300 million of revenue and roughly two points of gross margin. And the CFO described 2027 as an investment year, saying Intel probably wouldn't generate positive free cash flow that year.
Reddit: the search-traffic warning
Reddit's third-quarter revenue reached $895 million, and daily active uniques grew 12% to 130.3 million. But US daily actives fell 2% from a year earlier, and management said search referrals dropped by more than one million per week on average during October. If that continued, it said total daily active uniques could fall by a low double-digit percentage in the fourth quarter.
The concern is AI-powered search answering questions directly, so people never click through to the discussion the answer came from. Reddit's response is to build direct habits, with logged-in and app users, who it says account for over 80% of monetization, and to test login-focused changes in some markets outside the US.
The common thread: valuation multiplies expectations
Share prices reflect expected future earnings multiplied by what investors will pay for them. A hypothetical example: $10 of expected earnings at 20 times is a $200 stock. Cut expectations to $8 and the multiple to 16, and it's $128, a 36% drop, without the business collapsing. When both the outlook and confidence fall at once, the share price falls faster than either.
Neither company's question is answered by last quarter's growth. For Intel, it's whether demand becomes profitable, cash-generating output. For Reddit, it's whether it can keep its audience as discovery shifts to AI.
Watch the full breakdown on YouTube.
Disclosure: I own shares of Intel (INTC) and Reddit (RDDT). Education only, not financial or investment advice, and not a recommendation to buy or sell any security. Figures are as reported for the periods named; check the companies' own filings for current information.