Intel Corp. lowered its financial expectations for the year and reported its first decline in sales of data-center chips in seven years, reflecting uncertainty in the business-computing market and slowing demand amid the U.S.-China trade battle.

Revenue slid in the three months through March 30 in the semiconductor giant’s memory and programmable-chips businesses, too. But demand for Intel chips used in personal computers helped offset that decline, leaving overall first-quarter revenue flat compared with the year earlier...