Shares of Intel Corp. (INTC) are down over 8% on Friday morning on news that a new vital chip technology will not be released until late in 2019. Despite posting solid second-quarter results and lifting guidance for full-year 2018, Intel's outlook for the production of its new 10-nanometer chip disappointed investors.

One team of analysts sees further losses ahead as the second-largest chipmaker (after Samsung Electronics) struggles to hedge against new competition from rivals including Taiwan Semiconductor (TSM), Advanced Micro Devices Inc. (AMD), NVIDIA Corp. (NVDA) and Xilinx Inc. (XLNX). (See also: Intel Is at Risk From NVIDIA, AMD: Evercore.)

Overshadowed Core Numbers

In a note to clients Friday, analysts at Bank of America Merrill Lynch downgraded Intel to  neutral from buy, citing risk from the delayed arrival of its next-gen chip technology. The investment bank lowered its 12-month price target from $62 to $56, reflecting a 17% upside from Friday morning. Trading at $47.89, Intel stock has gained 3.8% year-to-date (YTD), compared to the S&P 500's 5.9% return. 

“The biggest risk to Intel is the year delay in shipments of its next-gen 10 [nanometer] product while rivals Taiwan Semiconductor have finally caught up and are enabling Advanced Micro Devices, Nvidia and Xilinx to potentially leapfrog,” wrote BAML. Analysts view the headline risk around product delays as "unlikely to change quickly," and wrote that it could "remain an overhang." Analysts at Bernstein also weighed in on the Intel results, agreeing that the core numbers should take a back seat to the technical issues and leadership shuffle for the time being, reported CNBC. 

Earlier this year, Intel's former CEO Brian Krzanich was forced to resign after an alleged infraction of the firm's nonfraternization policy that stemmed from a consensual relationship. He was replaced on an interim basis by Chief Financial Officer Robert Swan while the semiconductor company ramps up its CEO search. Earlier this month, Evercore analysts highlighted the management shakeup as a major risk during a "crucial time" for Intel as its "manufacturing advantages appear to be flagging" in light of advances by its chipmaking peers. (See also: Intel to Suffer on ‘Lack of Leadership’.)