Intel faced fierce competition and strategic shifts last year. Is the company poised for a comeback in the near future?Shares of Intel (INTC 2.37%) plunged 60.1% lower in 2024, according to data from S&P Global Market Intelligence. The semiconductor veteran ran into many issues last year, and the string of bad luck started many years ago. Complicating the picture even further, Intel is in the middle of an ambitious, costly, and difficult strategy shift.Intel's rough rideIntel's business performance was a mi ...

Intel Corporation (INTC) is planning to spin off its venture capital business, Intel Capital, into a standalone entity to enable greater autonomy from the parent company. The move is also intended to attract external capital and align Intel Capital’s corporate structure with that of other venture firms worldwide. The separation is likely to happen in the second half of 2025, and the new entity will start operating under a new name.With more than $5 billion in assets under management, Intel Capital is one of ...

This article has been reviewed according to Science X's editorial process and policies . Editors have highlighted the following attributes while ensuring the content's credibility: Credit: CC0 Public Domain Intel Corp., the once-dominant chipmaker struggling to revive its business and finances, plans to turn its venture capital arm into a separate fund with a new name. The chipmaker will continue to be an "anchor investor in the new company," according to a statement Tuesday. The division, currently know ...

Intel said on Tuesday that it plans to spin off Intel Capital, its venture capital wing, into an independent firm, the latest in a series of structural changes announced by the chipmaker.Turning Intel Capital, which has $5 billion in assets, into a standalone fund will allow it to raise money from outside investors, Intel said. Until now, the venture arm has been fully funded by Intel.Intel is coming off its worst year on the stock market since the company went public in 1971 due to a series of missteps and ...

Company Strategy - Intel plans to spin off its corporate venture arm, Intel Capital, into a standalone fund with Intel as an "anchor investor" [1] - The move aims to provide greater autonomy and flexibility to attract external capital [1] - Intel expects Intel Capital to begin operating independently in the second half of 2025 and will be rebranded [1] - The separation is seen as a win-win scenario, allowing the fund to access new capital sources while maintaining a strategic partnership with Intel [2] - This step supports Intel's broader strategy to maximize asset value and drive greater focus and efficiency across the business [2] Historical Context - Intel Capital was established in 1991 under former Intel executive vice president Les Vadasz [2] - Its original mission was to support the development of Intel's ecosystem through equity investments in strategic companies [2] - Since 2014, Intel Capital has increased its investments in AI startups, including notable portfolio companies like SambaNova, AI21 Labs, Figure, and Anyscale [3] Operational Details - The existing Intel Capital team will move to the new fund, and business operations will continue as normal during the transition [4] - Intel Capital currently has over $5 billion in assets under management [5] - Over the last 30 years, Intel Capital has invested in more than 1,800 companies across sectors like silicon, 5G, devices, and cloud [5] - The fund has deployed more than $20 billion in cash across markets including North America, Western Europe, Israel, and Asia Pacific [5]

Subscription Offer - Beyond the Wall Investing offers a subscription service providing access to high-quality analysis of Wall Street buying and selling ideas [1] - The service includes a free trial and a 10% discount for new subscribers [1] Analyst Background - Daniel Sereda is the chief investment analyst at a family office with global and diverse asset class investments [1] - He specializes in filtering vast amounts of data to extract critical investment ideas [1] - Sereda runs the investing group Beyond the Wall Investing, which provides institutional-level market analysis [1] Disclosure - The analyst has no current stock, option, or derivative positions in the mentioned companies but may initiate a long position in INTC within the next 72 hours [1] - The article expresses the analyst's personal opinions and is not compensated by any company mentioned [1]

Intel Corp - Intel is facing significant challenges in its efforts to right-size operations and advance its product roadmap, with no quick wins expected [7] - The company is dealing with tighter semiconductor capital spending and ongoing manufacturing challenges, which may hinder its ability to reclaim industry dominance [7] Airbnb Inc - Airbnb is carrying a lofty valuation, which adds to its investment concerns [2] - The stock has heavy short interest, contributing to mixed sentiment around the company [3] Joby Aviation Inc - Despite potential catalysts like certification progress in 2025, Joby Aviation is rated Underweight due to speculative tech enthusiasm pushing the stock beyond its fundamentals [4] - Regulatory and market realities may lead to turbulence for the company [4] General Industry Insights - JPMorgan analysts suggest a cautious approach to short ideas in the tech and rental sectors, citing high execution risks and the potential for excitement to not sustain stock performance [6]

Intel's AI Accelerator Challenges - Intel's Gaudi 3 chip offers solid performance but struggles with an immature software ecosystem, limiting its success despite aggressive pricing [1] - The company's software immaturity has been a recurring issue, as seen with the Arc Alchemist gaming graphics cards, which initially failed due to faulty drivers and bugs [2] - Intel's AI accelerator roadmap is complicated, with the Max family of GPUs and Gaudi family of AI accelerators not being extended, and the next-generation Falcon Shores expected to launch by the end of 2025 [3][4][5] Intel's AI Market Position - Intel has fallen behind in the AI accelerator market, with Nvidia dominating and AMD being competitive, while Intel missed its 2024 goal of selling $500 million worth of AI accelerators [7] - The company's past decision to cancel the Larabee GPU project in 2008 has hindered its ability to compete in the AI revolution and meet the demand for GPU accelerators [8] - Intel's current AI accelerator lineup comes from Habana Labs, acquired in 2019, with the Gaudi family of AI chips being similar to but not traditional GPUs [13] Intel's Foundry Business and Future Opportunities - Intel is leveraging its manufacturing expertise and investments to build a foundry business, with the Intel 18A process scheduled for volume production next year [10] - The company has secured high-profile customers like Microsoft and Amazon for its Intel 18A process, which could lead to more AI-related chip production in the future [11] - While Intel's AI accelerator revenue may not be impressive in 2025 due to software issues, the foundry business could become a larger opportunity for capturing AI spending in the long term [12] Intel's Recent Successes - Intel secured a deal with IBM to integrate Gaudi 3 chips into IBM's cloud data centers and watsonx AI platform, which is expected to boost Gaudi sales this year [6] - The company has improved its software over time, leading to better performance for its second-generation graphics cards [2]

Group 1 - Nvidia's project DIGITS aims to bring AI capabilities to the desktop market [1] - Recent updates from Nvidia are impacting the semiconductor industry [1] - The stock prices referenced are from the after-market on January 7, 2025 [1]

Intel's Foundry Business and 18A Process - Intel's foundry business faces a critical moment in 2025 as it aims to commercialize its 18A process, which is seen as a make-or-break semiconductor fabrication process [1] - Intel has invested heavily in its foundry operations, with capex reaching $25 billion annually in 2022 and 2023, up from $16 billion in 2019 [1] - The foundry business reported an operating loss of $7 billion on sales of $18.9 billion in 2023, with revenues expected to contract further in 2024 [1] - The 18A process is Intel's most advanced manufacturing technology, featuring a 1.8-nanometer node size, RibbonFET gate-all-around transistors, and PowerVia backside power delivery, which could give it a competitive edge over TSMC's N2 process [2] - Intel has reached critical milestones with the 18A process, with chips powering on, booting operating systems, and being operational within the company [3] - External customers are expected to tape out their first 18A designs in 2025, with enterprise-scale production to follow [3] Customer and Market Potential - Intel has secured significant contracts with the U.S. Department of Defense, Amazon, and Microsoft, which are designing custom chips, including AI accelerators [5] - The potential re-election of Donald Trump as U.S. president could indirectly benefit Intel by boosting domestic manufacturing and potentially imposing tariffs on foreign chip production [6] - Intel's domestic fabrication footprint could position it favorably compared to fabless rivals like AMD and Nvidia, which rely on TSMC for production [6] Financial Performance and Stock Valuation - Intel's stock has seen a 60% decline over the last 12 months, trading at around $20 per share, or just over 20x consensus 2025 earnings [7] - The company's stock has been more volatile than the S&P 500, with lackluster growth in recent years [7] - If Intel successfully executes its 18A transition, it could shift the narrative around the company and drive the stock higher, with a valuation of around $27 per share [7] Competitive Landscape and Industry Standards - Intel's 18A process shows a defect density of 0.4 defects per square centimeter, slightly worse than TSMC's benchmarks of 0.33 defects on its N7 and N5 nodes at comparable stages of development [4] - Despite rumors of Broadcom's disappointment with 18A yields, Intel's defect density is within industry standards for advanced nodes, suggesting adequate yields for production [4]