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Intel foundry faces critical test after stock's 45% plunge in October
CNBC • • business
Key Points:
- Intel's stock plunged 29% on Friday, marking its worst single-day drop since the 1970s, following a revenue forecast that missed analyst estimates due to a weakening PC market and rising memory costs.
- The company is struggling to grow its foundry business despite significant investment and government and partner backing, with no major external customers for its advanced chips yet.
- Intel is shifting production capacity from its advanced 18A chips, aimed at attracting foundry clients, to older nodes for its own data center products due to supply constraints, raising concerns about its foundry credibility.
- Industry experts suggest Intel faces challenges balancing its role as both a chipmaker and foundry, with some advocating for spinning off the foundry business to attract customers wary of competing with Intel.
- Despite these issues, Intel's CEO remains optimistic about growth in the server processor market and upcoming customer announcements, emphasizing the company's ongoing technological progress and commitment to execution.
