- Intel’s (INTC) stock dipped 1.3% to $24.53 amid a 43% year-over-year decline, with breakup rumors swirling as Broadcom (AVGO) targets its design business and TSMC (TSM) eyes its foundries, potentially valuing the company at $167-$237 billion.
- Analyst Ming-Chi Kuo highlighted Intel’s 18A process struggles, with Panther Lake samples showing 20-30% yields, alongside organizational and supply chain issues that hinder its foundry ambitions against TSMC’s dominance.
- Facing a faltering all-in-one model, Intel’s cash-draining foundry pivot and aging infrastructure threaten its relevance in a booming chip sector, where a breakup could unlock value but hinges on overcoming significant operational and geopolitical challenges.
Intel (INTC) finds itself at a crossroads, its stock dipping 1.30% to $24.53 in early Monday trading, a mere shadow of its former glory as it reels from a 43% year-over-year plunge. The semiconductor titan, once a poster child for vertically integrated chipmaking, is now the subject of breakup rumors that could see Broadcom (AVGO) swooping in for its design arm and Taiwan Semiconductor (TSM) eyeing its foundries, potentially valuing the company between $167 billion and $237 billion. Yet, the path to such a split is fraught with peril—geopolitical tensions, regulatory scrutiny, and the sheer financial weight of Intel’s foundry ambitions cast long shadows over any deal’s promise of boosting shareholder value.
Renowned analyst Ming-Chi Kuo’s recent X post throws a harsh spotlight on Intel’s struggles, particularly with its 18A process at the Intel Foundry Services (IFS). The first Panther Lake engineering samples, crafted on this cutting-edge node, are in the hands of major PC manufacturers, but early 2025 surveys peg yields at a dismal 20-30%, far from the robustness needed for mass production targeted for the second half of the year. Beyond technical woes, Kuo points to deeper rot—Intel’s organizational structure, supply chain inefficiencies, and a culture ill-suited to compete for external foundry contracts leave it lagging behind TSM, the undisputed king of pure-play chip manufacturing.
The first Panther Lake engineering samples, made with Intel/IFS’s 18A, are currently being tested by major PC ODM/EMS makers. My early 2025 industry survey showed 18A yields below 20-30%, so there’s still a lot of room to step up—which doesn’t bode well for Intel’s goal of…
— 郭明錤 (Ming-Chi Kuo) (@mingchikuo) February 24, 2025
The broader chip industry offers little comfort for Intel’s predicament. While rivals like TSM thrive by focusing solely on fabrication and Broadcom excels in high-margin design, Intel’s all-in-one model has crumbled under the pressure of a market that rewards specialization. Its foundry pivot, meant to reclaim leadership by opening factories to outside clients, has instead drained cash and exposed vulnerabilities—aging infrastructure and a failure to match the agility of competitors. The stock’s decline, slashing over half its value in five years, stands in stark contrast to a semiconductor sector riding a wave of AI-driven demand and innovation.
Intel’s 18A struggles are more than a technical hiccup; they signal a company fighting to redefine itself amid existential threats. Low yields suggest not just a delay in mass production but a potential inability to deliver the bleeding-edge chips that customers crave—chips that could restore confidence in a brand battered by years of missteps. Meanwhile, the breakup speculation reflects a desperate bid for relevance: spinning off design to Broadcom could sharpen focus, while handing factories to TSM might offload a money pit. But execution is everything—Intel must prove its facilities can serve a diverse clientele, a tall order given Kuo’s critique of its operational DNA.
The stakes couldn’t be higher. A successful breakup could unlock value and reposition Intel’s pieces as leaner, more competitive players. Fail, and it risks becoming a cautionary tale in a chip world that’s moved on, leaving behind a giant too slow to adapt. For now, the market watches, and Intel’s stock ticks lower, a quiet drumbeat to a drama still unfolding.
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Please stop writing articles based entirely on rumors. No matter how reputed the originator’s past reputation is. What does it even mean “My early 2025 industry survey”? You empower unethical ways of market manipulation. Who knows, maybe TSMC wants to spread these “rumours” to beat down the stock so they can get a super cheap deal. Ultimately, all consumers will be cheated of a choice with a HUGE market monopoly by a foreign company on such an important commodity as semiconductors.
I am sorry nobody knows how much Intel’s 18A yield. Besides, the yield is improving continuously. Intel is always doing better than others, including TSMC. It might be falling behind for a short time, now it will be ahead again, don’t knock it!