Things were looking pretty good for chip stock Intel (INTC) for a while there, but it managed to snatch defeat from the jaws of victory with the latest word from chief financial officer David Zinsner. Zinsner offered a remarkably pessimistic forecast for Intel’s foundry operations, and that was enough for investors to sell off and depart, at least for a while. Intel shares slipped over 3% in Wednesday afternoon’s trading.
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The news is about as bleak as you might think. Zinner noted that “We still feel on track to hit breakeven sometime in 2027.” When Intel fired up its foundry ambitions back in 2024, most figured it would take somewhere between 2024 and 2030 to start seeing payback. And indeed, 2027 comes in about as perfectly midrange as can be. Given Intel’s cash crunches—many of which were caused by the massive foundry pivot—it still remains galling.
There are some positive signs, though. We have already heard of potential customers for the new process, and we have also heard that the 18A process is firing up in earnest, with Clearwater Forest set to benefit from it as well as some third-party applications. But with 18A getting started, interest coming in, and the roadmap looking robust with the 14A process to come as well as several new GPUs, the end result should be good for Intel, but not right away.
A New Connection
Meanwhile, Intel is also working with NetApp (NTAP) on a new project, the produce of which will be available starting this summer. The NetApp AIPod Mini, as it is known, will step in to offer new benefits in the adoption of “AI inferencing.” Intel and NetApp have been working together for some time to help spur industry adoption of artificial intelligence (AI), addressing points like complexity and overall costs.
With the NetApp AIPod Mini, users can get much faster and less resource-intensive deployment of AI systems, including things like automated research or automated document drafting. It also has some field-specific use cases, like for the legal profession. The system will be made available to distribution partners first, and then branch out from there, reports noted.
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 25 Holds and four Sells assigned in the past three months, as indicated by the graphic below. After a 27.85% loss in its share price over the past year, the average INTC price target of $21.23 per share implies 2.3% downside risk.
