Latest news with #Intel18A
Engadget
4 days ago
- Business
- Engadget
Intel's next-gen manufacturing process is reportedly still struggling
Intel is reportedly still struggling with a chipmaking process crucial to its future. Reuters reports that the company's 18A process is still producing low yields and high defect rates. Intel has invested billions of dollars in the manufacturing process, on which it's pinned its hopes of gaining ground on TSMC. This isn't the first concerning news about 18A. Last year, a report stated that Broadcom was unhappy with the results of a test run for a potential order. However, Intel insisted at the time that 18A was on track to make its upcoming Panther Lake chips at volume later this year. "Our performance and yield trajectory gives us confidence this will be a successful launch that further strengthens Intel's position in the notebook market," Intel said last month. Intel has typically aimed for a yield of at least 50 percent of usable chips before scaling up production. The company is said to make the bulk of its profit after reaching 70 to 80 percent. Last year, 18A's usable Panther Lake chips had reportedly only reached a five percent threshold. Intel had aimed for 10 percent by this summer. Tuesday's report doesn't state 18A's current yield, only describing it as a small percentage. In a statement sent to Engadget, an Intel spokesperson said it is pleased with 18A's current state. "We feel very good about our trajectory on Intel 18A, and it will be the foundation of multiple generations of client and server products in the coming years," the spokesperson wrote. "Panther Lake is going to be a great product for Intel and our partners," the company continued, adding that its launch is still on track for later this year. In a July interview with Reuters , Intel's Chief Financial Officer David Zinsner suggested that 18A's yields were better than reports claimed. He added that yields tend to "start off low and improve over time." The company's 18A process is a risky bet, combining manufacturing changes with a next-gen transistor design. Intel embraced the challenge with an aggressive timeline that one of Reuters ' sources called a hail mary. 18A going well would also help attract business for its upcoming 14A process. Last month, Intel warned investors that it may have to leave chip manufacturing altogether if it doesn't land 14A contracts. The company needs all the help it can get. It recently confirmed that it would cut around 20 percent of its workforce by the end of this year. That follows 20,000 job cuts from June 2024 to July 2025. Earlier this year, it took on a new CEO to try to right the ship.
Globe and Mail
30-07-2025
- Business
- Globe and Mail
Intel's Earnings Call: Revenue Surges Amid Challenges
Intel ((INTC)) has held its Q2 earnings call. Read on for the main highlights of the call. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Intel's latest earnings call presented a mixed sentiment, reflecting both positive achievements and significant challenges. The company reported strong revenue performance and progress in its organizational restructuring and foundry strategy. However, concerns were raised about managing gross margins, facing competition in the server business, and dealing with CapEx constraints, leading to a cautiously optimistic outlook. Revenue Exceeds Guidance Intel's revenue for Q2 2025 reached $12.9 billion, surpassing the high end of its guidance range. This impressive performance was largely driven by strong demand in the client and data center segments, showcasing the company's ability to capitalize on market opportunities. Organizational Restructuring Progress Intel has made significant strides in its organizational restructuring efforts. The company has achieved its year-end target of 75,000 employees and has reduced management layers by approximately 50%. These actions are part of Intel's strategy to streamline operations and enhance efficiency. Foundry Strategy and Intel 18A Progress Intel's foundry strategy is advancing, with Intel 18A reaching key milestones. The start of production wafers in Arizona is a crucial step towards the anticipated Q4 launch of Panther Lake. Intel is focused on building trust with customers, which is essential for the success of its foundry business. Cost Management and Cash Flow Improvement To improve its financial position, Intel has lowered its CapEx guidance by $5 billion year-to-date and raised $900 million through a Mobileye offering. These measures are aimed at deleveraging the balance sheet and enhancing cash flow. Gross Margin Impacted by Impairments Intel's Q2 non-GAAP gross margin was 29.7%, affected by $800 million in noncash impairments and accelerated depreciation, along with $200 million in one-time period costs. These factors have put pressure on the company's profitability. Server Business Challenges The server business faced challenges as server ASPs decreased by 8% year-over-year due to competitive pressures. Intel anticipates continued difficulties in high-performance server market segments, which could impact future growth. CapEx Constraints and Project Delays Intel has decided to halt manufacturing projects in Germany and Poland and slow construction in Ohio. These decisions are part of the company's strategy to align spending with market demand and manage CapEx constraints effectively. Forward-Looking Guidance Looking ahead, Intel provided forward-looking guidance for Q3 2025, anticipating revenue between $12.6 billion and $13.6 billion, with a non-GAAP gross margin around 36% and breakeven EPS. For the fiscal year 2025, Intel aims to reduce operating expenses to $17 billion and further to $16 billion in 2026. The company is also targeting a net capital expenditure of $8 billion to $11 billion for the year, focusing on improving its balance sheet and cash flow generation. In summary, Intel's earnings call highlighted a blend of positive developments and ongoing challenges. The company is making progress in revenue growth and strategic initiatives, yet it faces hurdles in managing margins and competition. Investors will be keenly watching how Intel navigates these challenges while executing its forward-looking plans.
Yahoo
25-07-2025
- Business
- Yahoo
Intel Q2 Earnings Fall Short of Estimates, Revenues Remain Flat Y/Y
Intel Corporation INTC reported mixed second-quarter 2025 results, with revenues beating the Zacks Consensus Estimate but the adjusted earnings missing the same. Despite solid traction from an accelerated ramp-up of artificial intelligence (AI) PCs, margins were significantly affected by initiatives to drive operational efficiency and agility, and accelerate profitable growth. Intel has made significant strides in its cost-cutting plan to rebuild a sustainable growth engine. INTC's Net Income The company incurred a GAAP loss of $2.9 billion or a loss of 67 cents per share compared with a net loss of $1.6 billion or a loss of 38 cents per share in the year-ago quarter. Flat revenues and higher operating expenses led to a wider loss during the quarter. Excluding non-recurring items, non-GAAP loss in the reported quarter was $400 million or 10 cents per share against a net income of $100 million or 2 cents per share a year ago. The bottom line missed the Zacks Consensus Estimate by 11 cents. Intel Corporation Price, Consensus and EPS Surprise Intel Corporation price-consensus-eps-surprise-chart | Intel Corporation Quote INTC's Revenues GAAP revenues in the reported quarter remained almost flat year over year at $12.85 billion. The quarterly revenues exceeded the company guidance and beat the consensus estimate of $12.05 billion. The company witnessed healthy growth momentum in the Intel 18A process node and remains poised to launch the first Panther Lake stock-keeping unit by year-end. Management envisions robust growth opportunities with a strong product roadmap and semiconductor ecosystem, likely setting it apart from the competition. Intel's Segment Performance Client Computing Group revenues decreased 3% year over year to $7.9 billion as customers reduced inventory levels owing to macroeconomic headwinds. However, Intel witnessed healthy traction in AI PCs that have taken the market by storm and remains firmly on track to ship more than 100 million by 2025. Expansion of Arc GPU capabilities for new AI use cases also cushioned the top line. Panther Lake, the chip based on Intel 18A and the architectural successor to the well-received Lunar Lake, is slated to be launched in the second half of 2025, while Clearwater Forest, the first Intel 18A server product, is likely to be unveiled in the first half of and AI Group revenues improved 4% year over year to $3.9 billion, driven by a solid demand for host CPUs for AI servers and storage compute. Healthy demand for Xeon 6 processors for growing AI workloads also boosted the net sales in this Intel product revenues were $11.8 billion, down 1% year over year. Intel Foundry revenues increased to $4.4 billion from $4.3 billion. Revenues from all other businesses improved 20% to 1.1 billion, backed by healthy traction in the Mobileye vertical. Other Operating Details Non-GAAP gross margin declined to 29.7% from 38.7% a year ago. Non-GAAP operating margin loss was 3.9% against an operating margin of 0.2% a year ago. Margins were significantly hurt by impairment charges and restructuring costs for a structural and operating realignment across the company. These included significant reductions in headcount, operating expenses and capital expenditures. The company has reduced its capital expenditures and is focusing on simplifying parts of its portfolio to unlock efficiencies and create value. Cash Flow & Liquidity As of June 30, 2025, Intel had cash and cash equivalents of $9.64 billion with $44.02 billion of long-term debt. In the second quarter of 2025, Intel generated $2.05 billion of cash from operating activities compared to a cash flow of $2.29 billion a year ago. Outlook For the third quarter of 2025, Intel expects GAAP revenues to be within $12.6-$13.6 billion. Non-GAAP gross margin is likely to be 36%. Non-GAAP earnings are expected to be break-even per share. Zacks Rank Intel currently carries a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Upcoming Releases Arista Networks Inc. ANET is scheduled to release second-quarter 2025 earnings on Aug. 5. The Zacks Consensus Estimate for earnings is pegged at 65 cents per share, suggesting a growth of 25% from the year-ago reported has a long-term earnings growth expectation of 14.81%. ANET delivered an average earnings surprise of 11.82% in the last four reported Incorporated. QCOM is slated to release second-quarter 2025 earnings on July 30. The Zacks Consensus Estimate for earnings is pegged at $2.68 per share, indicating a growth of 15.02% from the year-ago reported has a long-term earnings growth expectation of 8.19%. Qualcomm delivered an average earnings surprise of 6.43% in the last four reported Inc. PINS is set to release second-quarter 2025 earnings on Aug. 7. The Zacks Consensus Estimate for earnings is pegged at 34 cents per share, implying a growth of 17.24% from the year-ago reported has a long-term earnings growth expectation of 33%. PINS delivered an average earnings surprise of 0.53% in the last four reported quarters. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Intel Corporation (INTC) : Free Stock Analysis Report QUALCOMM Incorporated (QCOM) : Free Stock Analysis Report Arista Networks, Inc. (ANET) : Free Stock Analysis Report Pinterest, Inc. (PINS) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
25-07-2025
- Business
- Yahoo
Intel Corp (INTC) Q2 2025 Earnings Call Highlights: Revenue Surpasses Expectations Amid ...
Revenue: $12.9 billion, above the high end of guidance. Non-GAAP Gross Margin: 29.7%, impacted by $800 million in non-cash impairment and $200 million in one-time period costs. Non-GAAP EPS: Minus $0.10, excluding charges would have been $0.10. Operating Cash Flow: $2.1 billion. Adjusted Free Cash Flow: Negative $1.1 billion. Cash and Short-term Investments: $21.2 billion. Intel Products Revenue: $11.8 billion, slightly up sequentially. CCG Revenue: Up 3% quarter-over-quarter. DCAI Revenue: Down 5% sequentially. Intel Foundry Revenue: $4.4 billion, down 5% sequentially. Operating Profit for Intel Products: $2.7 billion, 23% of revenue. Intel Foundry Operating Loss: $3.2 billion, down $848 million sequentially. All Other Revenue: $1.1 billion, up 12% sequentially. Q3 Revenue Guidance: $12.6 billion to $13.6 billion. Q3 Gross Margin Guidance: Approximately 36%. 2025 OpEx Target: $17 billion. 2026 OpEx Target: $16 billion. 2025 Gross Capital Investment: Approximately $18 billion. Net CapEx Forecast: $8 billion to $11 billion for 2025. Warning! GuruFocus has detected 7 Warning Signs with INTC. Release Date: July 24, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Intel Corp (NASDAQ:INTC) reported Q2 revenue above the high end of its guidance, reflecting strong demand across its business. The company is making progress on its foundry strategy, focusing on building trust with customers and ensuring high-quality, reliable wafer delivery. Intel Corp (NASDAQ:INTC) is committed to improving its balance sheet, with actions taken to reduce operating expenses and improve execution. The company is focused on launching its Panther Lake SKU by year-end, which is expected to solidify its strong share in the notebook market. Intel Corp (NASDAQ:INTC) is actively engaging with external ecosystem partners to improve yield and performance targets for its Intel 18A technology. Negative Points Headline profitability was impacted by several one-time items and impairments, affecting overall financial performance. The company faces challenges in the high-end desktop market and needs to improve its position in broader hyperscale workloads. Intel Corp (NASDAQ:INTC) has decided not to continue with manufacturing projects in Germany and Poland, indicating potential setbacks in its expansion plans. The company recognized approximately $800 million of non-cash impairment and accelerated depreciation charges related to excess prior generation tools. Intel Corp (NASDAQ:INTC) is experiencing capacity constraints in Intel 7, which are expected to persist through the second half of the year. Q & A Highlights Q: Lip-Bu, how fast can you fix the x86 side of the business to build trust for the foundry business? A: Lip-Bu Tan, CEO: We are focusing on the 18A technology, with steady progress on yield and performance targets. The engagement with external ecosystem partners is helping us improve, and we are confident in launching our Panther Lake SKU by year-end. Building trust with customers involves demonstrating reliability and delivering on time and at scale. Q: Dave, can you elaborate on the reasons for the sequential decline in gross margin guidance and the outlook for next year? A: David Zinsner, CFO: The main driver is the ramp of Lunar Lake, which impacts gross margins due to the cost structure. Panther Lake's early-stage maturity also contributes to higher costs. However, as yields improve and volumes increase, we expect this to become a tailwind. Foundry gross margins are expected to expand next year, and product cost structure improvements will also help. Q: Lip-Bu, how do you address concerns about the 14A development and its impact on the foundry strategy? A: Lip-Bu Tan, CEO: We are focused on building the foundational technology for 14A and engaging with customers early in the process. We are committed to the foundry business but will only invest in CapEx when we see customer volume commitments and performance milestones met. This disciplined approach ensures we deliver reliable results to our customers. Q: Dave, what is the outlook for CapEx next year, and how much can you reduce it? A: David Zinsner, CFO: We expect CapEx to decrease next year as we digest previous investments. While maintenance CapEx is about half of our current level, we anticipate spending more than $9 billion but less than $18 billion. We will finalize our CapEx plans in early 2026. Q: Lip-Bu, can you expand on Intel's AI strategy and how it plans to compete in the market? A: Lip-Bu Tan, CEO: We are focusing on inference and agentic AI, aiming to provide a full stack solution from system software to silicon. We plan to leverage our x86 franchise and explore new architectures, including working with startups and system companies for purpose-built AI platforms. We will share more details on our strategy in the coming months. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
01-07-2025
- Business
- Yahoo
Intel Collaborates With Exostellar to Scale AI Initiatives Faster
Intel Corporation INTC has partnered with Exostellar to make enterprise-grade AI infrastructure accessible in a cost-effective manner. Intel's partnership with this leading innovator in autonomous compute orchestration and cloud optimization, which leverages AI and ML technologies, is likely to deliver an end-to-end solution with support for quota enforcement, dynamic borrowing, fair queuing and priority-based scheduling. This, in turn, will bring cloud-like agility and efficiency to on-premises or hybrid infrastructure for a more competitive AI hardware collaboration combines Intel Gaudi AI accelerators with Exostellar's advanced Kubernetes-Native AI Orchestration, Multi-Cluster Operator to enable customers to maximize utilization, control access and streamline the compute resources across teams and projects. It aims to empower organizations to build and scale AI initiatives faster, more efficiently and more cost-effectively by developing an open ecosystem with multi-vendor support that boosts ROI while maintaining Intel Gaudi 3 AI accelerator is poised to power AI systems with remarkable efficiency. Equipped with up to tens of thousands of accelerators interconnected through Ethernet, the Gaudi 3 accelerator promises a substantial boost in AI training and inference capabilities, enabling global enterprises to deploy AI at scale with ease. It boasts impressive performance metrics, offering faster time-to-train and superior inference throughput. Furthermore, Intel's commitment to open, community-based software and industry-standard Ethernet networking ensures flexibility and scalability for enterprises, allowing them to seamlessly integrate AI solutions tailored to their specific needs. Intel remains on track with its 5N4Y (five nodes in four years) program to regain transistor performance and power performance leadership by 2025. Intel Xeon platforms have reportedly set the benchmark in 5G cloud-native core with substantial performance and power-efficiency improvements, additional power-saving capabilities and easy-to-deploy software. This has triggered healthy demand trends from major telecom equipment manufacturers and independent software vendors to optimize and unleash proven power savings for a more sustainable has witnessed healthy traction in AI PCs, which have taken the market by storm and remain firmly on track to ship more than 100 million by the end of 2025. Panther Lake – the chip based on Intel 18A and the architectural successor to the well-received Lunar Lake – is slated to be launched in the second half of 2025, while Clearwater Forest – the first Intel 18A server product – is likely to be unveiled in the first half of 2026. Despite AI chip traction, Intel has plunged 27.9% in the past year against the industry's growth of 24.3%, lagging its peers Advanced Micro Devices, Inc. AMD and NVIDIA Corporation NVDA. While Advanced Micro has declined 13.6%, NVIDIA has gained 28.8% over this period. One-Year INTC Stock Price Performance Image Source: Zacks Investment Research Earnings estimates for Intel for 2025 have moved down 84.9% to 28 cents over the past year, while the same for 2026 has declined 68.2% to 74 cents. The negative estimate revision depicts bearish sentiments for the stock. Image Source: Zacks Investment Research Although Intel has scaled its AI footprint, it seems to lag NVIDIA on the innovation front, with the latter's H100 and Blackwell GPUs being runaway successes. Leading technology companies are reportedly piling up NVIDIA's GPUs to build clusters of computers for their AI work, leading to exponential revenue growth. An accelerated ramp-up of AI PCs further affected the short-term margins of Intel as it shifted production to its high-volume facility in Ireland, where wafer costs are typically higher. Margins were also adversely impacted by higher charges related to non-core businesses, charges associated with unused capacity and an unfavorable product mix. Image Source: Zacks Investment Research China accounted for more than 29% of Intel's total revenues in 2024, making it the single largest market for the company. However, the communist nation's purported move to replace U.S.-made chips with domestic alternatives significantly affected INTC's revenue prospects. The directive to phase out foreign chips from key telecom networks by 2027 underscores Beijing's accelerating efforts to reduce reliance on Western technology amid escalating U.S.-China weaker spending across consumer and enterprise markets, especially in China, resulted in elevated customer inventory levels, resulting in soft demand trends. Strict export control measures are further likely to affect the market dynamics, leading to below-par revenue growth in the near term. Intel has been facing challenges due to the disruptive rise of over-the-top service providers in this dynamic industry. Price-sensitive competition for customer retention in the core business is expected to intensify in the coming days. Aggressive competition is likely to limit the ability to attract and retain customers and affect operating and financial road ahead for Intel is bumpy and strewn with daunting challenges, and how it navigates these roadblocks in the coming days remains to be seen. Intel carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Intel Corporation (INTC) : Free Stock Analysis Report Advanced Micro Devices, Inc. (AMD) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
