Could Intel’s Foundry Be Worth $500 Billion?

[MKWVentures]

Thanks to Lip Bu Intel has become way tight lipped too much i would say they won't give us a client product roadmap

Intel is still giving quarterly roadmap updates to customers similar to before. Those are under NDA but they pop up on the internet every once in a while (Usually in May/June around Computex)

That said, I understand he is still poking at the roadmap and there may be changes so he doesnt want to announce the roadmap publicly. I expect updates by Computex.

Personally, I think the client roadmap is pretty solid... just need to kill off the old parts (bartlett lake on Intel 7 was just annouced with 10 year availability so maybe I am wrong). ... also need a new low cost part (wildcat)

I think the DC CPU roadmap needs work. They are have products stacked up across 4-5 nodes. Intel 7 products still dominate. Cancelling some and releasing one that truly competes with AMD seem like a good idea to me.

Hopefully something leaks out so we can discuss.

 

[MKWVentures]

Thanks to Lip Bu Intel has become way tight lipped too much i would say they won't give us a client product roadmap

just saw this link. This is part of the roadmap discussion (support for old sockets). I also heard meteor lake is down to trivial volume.....
It feels like LBT wants to do All products all the time (new, old, refresh-refresh) . The days of pushing people to new nodes and products are gone.

Insider Says Intel Wants To Rival AMD With Future Sockets In Longevity, Also Planning New Raptor Lake Refresh For LGA 1700

Intel's existing and future CPU sockets will offer AMD-like support and longevity, this is the claim from leading insider, Jaykihn.

wccftech.com

I expect the actual, confidential 5Q type roadmap type deal to show up on internet in next 60 days. ....

 

[Artificer60]

The only think saving the valuation is that People seem to think Intel is good at manufacturing and delivering process and packaging technology. The correct analogy today is IBM 20 years ago IMO.

Under Gelsinger you might have been right. There seems to be a very different approach to managing R&D and manufacturing than in the Intel of old. Time will tell, but I'm hopeful that Intel will get their house back in order.

 

[Barnsley]

In my world, Yes. Dreams and aspirations give a early bump.. maybe it lasts, maybe not. I am not forecasting stock price. I am forecast whether someone will be succesful.

In the real world: People buy stocks based on dreams and hopes and what ifs. Then say "what about Amazon?, What about tesla?" That fine...... enjoy.

And when I say earnings, I dont just mean current EPS. I mean when DZ says >80% of Intel revenue is non EUV. I mean when DZ says IFS will not break even if they get 14A customers. I mean when LBT says we will know if anyone commits by 2H 2026. I mean when DZ says IFS is not "investable".

Side note: the stock price climb feels more like news is leaking out somewhere. A deal or major financial improvement. just a feeling.... Not info that I have heard

lets see what Intel is successful at and and what they are not successful at. The Sell side analysts can make up price targets.

The day traders punting stocks couldnt care less whether a business is profitable or not.
If some online group say this stock is a go , away it goes.
Those doing in depth analysis are now in the minority

 

[siliconbruh999]

I expect the actual, confidential 5Q type roadmap type deal to show up on internet in next 60 days. ....

lol i would be happy on that day for sure.

just saw this link. This is part of the roadmap discussion (support for old sockets). I also heard meteor lake is down to trivial volume.....

Meteor lake shares foundry space with Granite Rapids/Panther Lake so makes sense.

It feels like LBT wants to do All products all the time (new, old, refresh-refresh) . The days of pushing people to new nodes and products are gone.

as long as the refresh refresh are on IFS that is good one way to keep the fabs full

 

[MKWVentures]

Under Gelsinger you might have been right. There seems to be a very different approach to managing R&D and manufacturing than in the Intel of old. Time will tell, but I'm hopeful that Intel will get their house back in order.

Intel is developing technologies. They just need to double the volume and significantly improve the outs per tool at Ireland (Intel 3) and Arizona (18A). If not it will be IBM2.0 (advanced technologies at 2x the cost).

Lets see what they say next week

 

[hist78]

It took 14 years for Amazon to start to make money. Can IFS wait that long?

Probably not. Amazon was experiencing rapid revenue growth driven by new business models such as the Amazon Marketplace for third‑party sellers, Prime two‑day and same‑day delivery, AWS cloud computing services, and Prime Video and Music. In that situation, investors were willing to wait.

Intel, on the other hand, is seeing stagnant or declining revenue and profit. And Intel is still operating under an old business model against superior competitors.

 

[siliconbruh999]

Intel, on the other hand, is seeing stagnant or declining revenue and profit. And Intel is still operating under an old business model against superior competitors.

again Business Model doesn't matter your execution does if you do the things wrong way no one can save you. If Intel products and foundry were working correctly they would be sitting on 80%GM easily due to being an IDM.

 

[XYang2023]

Intel is developing technologies. They just need to double the volume and significantly improve the outs per tool at Ireland (Intel 3) and Arizona (18A). If not it will be IBM2.0 (advanced technologies at 2x the cost).

Lets see what they say next week

I guess your spreadsheet model might be backward looking. Also Tesla's demand is quite sizable.

https://twitter.com/x/status/2045619439702552945

https://twitter.com/x/status/2043149054625161403

 

[XYang2023]

https://twitter.com/x/status/2045741642628669650

 

[hist78]

again Business Model doesn't matter your execution does if you do the things wrong way no one can save you. If Intel products and foundry were working correctly they would be sitting on 80%GM easily due to being an IDM.

Execution is certainly critical, but even the best execution cannot subsitute a failed business model. A business model is the guiding idea behind "what" a company does, "how" it operates, and "why" it pursues certain strategies.

The best CEOs, managers, and employees may win some battles through strong execution, but they will ultimately lose the war if the underlying business model is flawed or obsolete.

Since 2006, Intel has had five CEOs and has laid off or spun off roughly 100,000–110,000 employees over the past 20 years.

In mid‑2006, Intel employed about 102,500–103,000 people. By the end of 2025, after multiple layoffs and divestitures, Intel’s headcount had fallen to around 85,100.

The table below summarizes major Intel layoffs and spinoffs from 2006 to 2026. The gross total across all events is roughly 100,000–110,000 positions removed, although Intel’s net headcount did not shrink by that full amount because the company also hired aggressively, especially between 2018 and 2022.

With such large cycles of firing and hiring over two decades, it’s clear that Intel has repeatedly tried to find the right engineers, managers, and CEOs to “execute.” Yet Intel still struggles with execution today. I believe the underlying issue is the failed business model that forces Intel’s leaders and employees into the wrong approaches and poor decisions.

 

[XYang2023]

Nothing wrong with layoffs especially in the current context.

https://twitter.com/x/status/2045930126802891031

https://twitter.com/x/status/2045950765366456593

 

[hist78]

And all those numbers just get IFS close to break even.... and they dont have the capacity, so they cannot do it by 2027.

This is a mystery to me: from 2020 to 2025, Intel spent $127.27 billion on CapEx, yet its revenue declined while the company claimed it was operating under very tight capacity. How is that possible? With $127.27 billion, Intel should have had enough funding to build four or five modern fabs. It just doesn’t add up.

We also need to remember that IFS does not have a large volume external customer in production today. There are no meaningful capacity allocation conflicts between Intel’s product divisions and external foundry customers. So how is it that IFS, one of the two most important components of the IDM business model, cannot even provide enough capacity to meet Intel’s own internal demand? And this is after spending $127.27 billion in CapEx.

The numbers simply don’t align with the narrative.

 

[XYang2023]

https://twitter.com/x/status/2046149371541205003

 

[XYang2023]

https://twitter.com/x/status/2046168445168054340

 

[XYang2023]

https://twitter.com/x/status/2046236633960485359

 

[MKWVentures]

I guess your spreadsheet model might be backward looking. Also Tesla's demand is quite sizable.

https://twitter.com/x/status/2045619439702552945

https://twitter.com/x/status/2043149054625161403

View attachment 4456

All my spreadsheets are forward looking. DZ specifically said IF Intel has to spend to ramp a customer for 14A it would HURT their chance for breakeven. Sometimes AI is not the best summary of what is actually happening LOL.

If there is tons of demand out there, they would have to start designing on Intel silicon today. Which means they would not have meaningful revenue until 2029? correct.

What is you estimate of Tesla demand as a percentage of total foundry TAM?

Please let me know what numbers would be a scenario for breakeven (other than a massive write off, which may be planned). What do you think will happen?

 

[Artificer60]

Execution is certainly critical, but even the best execution cannot subsitute a failed business model. A business model is the guiding idea behind "what" a company does, "how" it operates, and "why" it pursues certain strategies.

The best CEOs, managers, and employees may win some battles through strong execution, but they will ultimately lose the war if the underlying business model is flawed or obsolete.

Since 2006, Intel has had five CEOs

There are several alternative explanations for that. First and most obvious would be to point at a Frank Yeary run board. They simply choose poorly. IMO Krzanich is the worst CEO Intel has ever had. After Intel, he tanked the stock of CDK Global before the firm was acquired ($75 down to $40) and went private. I believe he is now working on wrecking his 3rd company.

Alternatively, if you don't like that explanation we can go with a toxic company culture that resulted in no decent CEO wanting to come and and fix the mess prior to Lip-Bu Tan. So I remain unconvinced that this must be a sign of a failed business model.

and has laid off or spun off roughly 100,000–110,000 employees over the past 20 years.

This argument sounds like the famous Mark Twain quote to me. "There are three kinds of lies: lies, damn lies and statistics.

The semiconductor industry is cyclical. If you want this to mean something you need to give a point of comparison. Perhaps you should look at Micron's layoff history over the same time period. They are not an IDM, so by your argument they should have a sound business model and, therefore, a stable employee base.

 

[MKWVentures]

This is a mystery to me: from 2020 to 2025, Intel spent $127.27 billion on CapEx, yet its revenue declined while the company claimed it was operating under very tight capacity. How is that possible? With $127.27 billion, Intel should have had enough funding to build four or five modern fabs. It just doesn’t add up.

We also need to remember that IFS does not have a large volume external customer in production today. There are no meaningful capacity allocation conflicts between Intel’s product divisions and external foundry customers. So how is it that IFS, one of the two most important components of the IDM business model, cannot even provide enough capacity to meet Intel’s own internal demand? And this is after spending $127.27 billion in CapEx.

The numbers simply don’t align with the narrative.

those are great questions. They were asked in a emotional manner at last earnings report by analysts

Our model based on some inputs from very wise people on this site and inputs from people who know the Intel fabs:

1) Intel 7 demand is vert high for both client and server. 85+ of Intels sales are Intel 7 or Older.
2) Intel took Intel 7 capacity down thinking people would move to 18A
3) 18A cannot be ramped full out and customers forced to 18A (or 3) due to financial constraints and negative margin impacts (Intel 7 has HIGHER margin than 3 or 18A).
4) People are not as interested in higher price points for Newest products from Intel. Intel continues to lose share so Intel has limitations.

The amount of wasted and stranded Capex by Intel from 2021-2024 is very high....

Hopefully they clear up some items this week.