Why Intel Stock Is Falling Today

Intel (NASDAQ: INTC) stock is losing ground in Friday's trading. The semiconductor company's share price was down 5.1% as of 12:30 p.m. ET, according to data from S&P Global Market Intelligence .

Intel stock is losing ground in conjunction with sell-offs triggered by a massive global IT outage. Due to issues created by a new software update rolled out by cybersecurity provider CrowdStrike , hundreds of millions of computers around the globe were rendered unusable. While Intel's hardware doesn't have a direct connection to the cause of the outage, it is tangentially related.

CrowdStrike just took out hundreds of millions of Intel-based PCs and laptops

CrowdStrike is the top provider of cloud-based endpoint protection services for enterprises. When it comes to cybersecurity services used to protect computers, mobile devices, and other hardware from being used to attack networks, no other provider's technology is more widely used. Unfortunately, the deeply entrenched nature of CrowdStrike's software opened the door for the massive global IT outage occurring today.

Computers using Microsoft 's Windows operating system were put into the famous "blue screen of death" if they came into contact with CrowdStrike's software update. The vast majority of these machines use central processing units (CPUs) from Intel. While there's no indication that the semiconductor company's CPUs played a role in the outage, the meltdown highlighted the delicate nature of global IT systems

Today's IT crash appears to have taken some bloom off Intel stock

Intel stock was proving remarkably resilient in a week that was otherwise seeing big sell-offs for semiconductor stocks. The IT outage triggered by CrowdStrike's update is spurring another round of sell-offs for semiconductor stocks and the tech sector at large, and Chipzilla isn't escaping this one. Investors may also be reconsidering other potentially bearish catalysts for the stock.

Earlier this week, former president and current presidential candidate Donald Trump stated in an interview with Bloomberg Businessweek that he might require Taiwan to pay for defense services if he were to retake the presidency. The comments raised concerns that such a shift could embolden China to invade Taiwan. Bloomberg also reported that the Biden administration was considering new regulatory measures that could make it far more difficult to export chips and semiconductor-manufacturing equipment to the Chinese market.

Intel stock was initially able to rise above these pressures thanks to the its domestic fabrication strengths and fab expansion initiatives, but the company does actually rely on Taiwan Semiconductor Manufacturing for the fabrication of some of its advanced chips. With the recent surge in bearish sentiment around tech stocks, investors are taking a more cautious approach to the U.S. semiconductor giant today.

Keith Noonan has positions in CrowdStrike. The Motley Fool has positions in and recommends CrowdStrike and Microsoft. The Motley Fool recommends Intel and recommends the following options: long January 2025 $45 calls on Intel, long January 2026 $395 calls on Microsoft, short August 2024 $35 calls on Intel, and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy .