TLDR

Intel stock rose 2.79% to $22.49 following reports of a major manufacturing strategy shift
CEO Lip-Bu Tan may halt 18A process marketing to new clients, redirecting efforts to 14A
Decision may involve a write-off up to $1 billion, with board discussions due in fall
Intel will honor existing 18A deals with Microsoft and Amazon, with Panther Lake chips due in 2025
INTC eyes Apple and Nvidia as potential 14A customers to rival TSMC

Intel Corporation (NASDAQ:INTC) closed at $22.49 on July 3, marking a 2.79% gain amid speculation of a significant manufacturing realignment.

Intel Corporation (INTC)

CEO Lip-Bu Tan is reportedly evaluating the future of Intel’s 18A chip process and considering halting its promotion to new foundry clients in favor of focusing on its 14A technology.

Tan Targets Apple and Nvidia with 14A Strategy

Since assuming leadership in March 2025, Tan has taken bold steps to address Intel’s mounting financial and competitive challenges. His latest strategy involves accelerating development of Intel’s 14A process, which the company hopes will be more competitive with Taiwan Semiconductor Manufacturing Co. (TSMC). The goal is to win high-value contracts from major players such as Apple and Nvidia, who currently rely on TSMC for chip production.

Industry analysts believe this pivot could better position Intel in the global chip race, but it would come at a cost. Shelving the 18A and 18A-P offerings for external sales might lead to a write-down ranging from several hundred million dollars to over $1 billion.

18A Remains Active for Internal and Existing Clients

While Intel may stop pitching 18A to new clients, it remains committed to fulfilling existing agreements. The company confirmed it will continue supporting Microsoft and Amazon under current deals and plans to roll out its Panther Lake processors, based on the 18A node, in 2025. These chips are expected to be among the most advanced produced entirely in the U.S.

This is what Intel said they are going to do but media, analyst, investors all thought Intel will become a successful foundry the day 18A tech is out. Foundry will take some timegrind to be successful. I always understood 5N4Y is a plan to bring Intel Products back to leadership pic.twitter.com/bz0mpMHQxK

— DKR (@D_K_Rajasekar) July 3, 2025

Despite these commitments, Intel has indicated that it is the primary user of the 18A process and has not yet commented directly on the potential strategy change, instead dismissing the current reports as speculative.

Financial Struggles Drive Reassessment

The move comes after a difficult fiscal year for Intel. In 2024, the company posted a net loss of $18.8 billion, its first unprofitable year since 1986. To offset ongoing financial pressures, Intel may reduce its factory workforce by up to 20%, based on recent internal discussions. These cost-saving efforts underscore the urgency of Tan’s push to realign the company’s chipmaking operations.

Intel stated it is committed to improving financial performance, winning customer trust, and executing a clearer roadmap. Any decision regarding the 18A phase-out will likely be made at the company’s fall board meeting, reflecting the complexity and scale of the matter.

Analyst Expectations Mixed on INTC Valuation

According to a consensus of 32 analysts, Intel’s average one-year price target is $21.20, suggesting a potential downside of about 7%. However, GuruFocus places its estimated fair value at $23.86, implying 4.4% upside from current levels. These contrasting views reflect the uncertain impact of Intel’s evolving foundry strategy.

 

The post Intel Corporation (INTC) Stock: Strategic Foundry Shift From 18A to 14A, May Reshape Chipmaking Future appeared first on CoinCentral.

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Filed under: News - @ July 4, 2025 1:29 pm