Intel earnings setup: Options market prices in double-digit move

As Intel (INTC) gears up for its highly anticipated earnings report after the closing bell Thursday, the options market is signaling expectations for explosive volatility. Trading near $106 per share in Wednesday midday trading, the semiconductor giant is drawing intense speculative interest. Options contracts expiring Friday are pricing in an aggressive implied move.

Wall Street expects Intel (INTC) to return to profitability and post its strongest quarterly revenue growth in nearly six years, as AI-driven demand, a rebound in data center processors, and optimism around CEO Lip-Bu Tan's turnaround strategy have fueled a sharp re-rating of the stock. Analysts expect the chipmaker to report earnings per share of $0.22, compared with a loss of $0.10 in the year-ago quarter, on revenue of $14.45B, up 12.0% year over year.

An analysis of the at-the-money straddle for Friday’s expiration reveals that traders are bracing for an expected post-earnings swing of roughly $13, or around 12.3%. This high premium suggests the market expects the stock to gap somewhere between $93 on the downside and $119 on the upside by the end of the trading week.

What stands out most in the current pricing is a pronounced bullish skew. Unlike typical pre-earnings setups where downside put options command higher premiums due to protective hedging, speculators are eagerly paying up for upside exposure.

Specifically, far out-of-the-money call options, particularly at the $110, $115, and $120 strikes, are seeing massive clusters of volume and open interest. The $120 call currently holds the highest open interest on the board, serving as a primary upside target for bulls hoping for a blowout quarter or strong forward guidance.