Can Intel turn things around in 2025 with new management at Helm?

Intel Corporation INTC has plunged 59.3% over the past year while the industry has seen 123.4% growth, underperforming its peers Advanced Micro Devices, Inc. AMD and NVIDIA Corporation NVDA. Much of this underperformance was due to severe financial difficulties and operational challenges that forced management to undertake a comprehensive review of its operations while simultaneously undertaking a corporate restructuring at the top levels.

Intel has replaced CEO Pat Gelsinger with David Zinsner and Michelle Johnston Holthaus as interim co-CEOs. The company is considering several options, including possibly splitting up its product design and manufacturing divisions and considering which factory projects should be scrapped. There are also plans to establish Intel Foundry as an independent subsidiary to capture strategic advantages and improve capital efficiency through clearer separation and independence from the rest of Intel. The department posted an operating loss of $5.8 billion in the last reported quarter.

Price development for one year

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Intel remains true to its core strategy and has decided not to develop it further in order to stimulate its growth momentum. The company reiterated its previous revenue forecast of $13.3 billion to $14.3 billion for the fourth quarter of 2024 and emphasized diligent execution of operational goals to establish itself as a leading foundry.

However, management determined that the company needed to undergo a significant cultural change to move from integrated equipment manufacturing to a world-class foundry. This would represent a shift from a “no wafer left behind” mindset, where the company builds additional capacity to meet demand (in the hope that the additional capacity is never left unused), to a “no capital left behind” mindset back”, which aims to require increasing efficiency by exploiting all possible wafers from the existing capacity.

Intel has launched AI (artificial intelligence) chips for data centers and PCs. This marks one of the biggest architectural changes for the company in 40 years. The aim of the strategic decision is to establish itself more firmly in the expansive AI sector, which spans cloud and enterprise servers to networks, volume clients and ubiquitous edge environments, in line with evolving market dynamics.

The company remains on track with its 5N4Y (five nodes in four years) program to regain leadership in transistor performance and power supply performance by 2025. Intel is making solid progress with Intel Xeon processors. The Intel Xeon 6 processor with Efficient Cores (E-Cores), codenamed Sierra Forest, is the company’s first Intel 3 server product designed for high-density, scalable workloads. Intel

The company launched Intel Core Ultra 200V series processors (formerly called Lunar Lake) in the third quarter and Arrow Lake after the end of the quarter, bringing the power of AI PC to the desktop and paving the way for the launch of Panther Lake in the second half of 2025. Intel also announced the introduction of glass substrates for advanced chip packaging. This industry-leading product is expected to be available for mass consumption in the second half of this decade, with one trillion transistors per pack expected to be delivered by 2030.

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