Why Mobileye Crashed and Burned Today
Shares of autonomous driving solutions provider Mobileye (NASDAQ: MBLY) plunged 25.6% in Thursday trading, as of 3:20 p.m. ET.
The company, which is 88% owned by (NASDAQ: INTC) but also has publicly traded shares on the Nasdaq, issued a press release this morning, saying that 2024 could be a very tough year.
The semiconductor sector is notoriously cyclical and follows a pattern that seems to repeat itself no matter how experienced these chip companies become. First, there are shortages, either due to high demand or supply constraints, as which happened to the auto industry during 2021-2022. In those periods, customers tend to over-order, because they don't know if product will be available when needed. However, what inevitably happens is that when supply constraints ease and/or demand comes down (or both), chip customers (in this case, automakers) stop their orders, and a demand "air pocket" forms.
Source Fool.com
Intel Corp. Stock
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