3 takeaways from Intel earnings: Cash flow, foundry progress and hardware surprise

Core Insights - Intel has returned to profitability in Q3 after six consecutive quarterly losses, driven by strong demand for chips, particularly in the client computing segment, which grew 5% year over year [3][4] - The company has received significant investments, including $8.9 billion from the U.S. government and $2 billion from Softbank, and expects to close a $5 billion deal with Nvidia by the end of Q4 [5][6] - Despite positive developments, Intel's foundry business is still struggling, with a 2% revenue decline year over year and a lack of major customers [8] Financial Performance - Intel's cash position and liquidity improved significantly in Q3, with expectations to reach $35 billion in cash after completing various transactions [4][5] - The stock price has increased by over 50% since August 22, following the announcement of the U.S. government's investment [6] Foundry Business - The foundry segment remains a work in progress, with revenue declining and no major customers secured yet [8] - Intel is advancing its chip technology with two fabs running 18A nodes, aimed at AI and high-performance computing applications [8] Market Demand - Older chipmaking processes have continued to perform well, with demand being met through existing inventory, although there may be supply issues in the upcoming quarters [9][10] - Many customers are opting for less advanced hardware to refresh their systems, indicating a preference for proven technology over cutting-edge solutions [10]