Intel’s recent struggles have raised skepticism among investors about a potential turnaround. The company’s surprise retirement of CEO Pat Gelsinger and its shift to interim co-CEOs have added uncertainty to its foundry business and product lines.
The chipmaker’s 18A process, a key manufacturing technology node, is expected to push Intel back into the lead in terms of manufacturing technology. However, the pace of customer wins has been slow, and potential customers may be hesitant to commit to it due to the current leadership. A delay or issues with the process could derail products that rely on it.
Intel faces challenges in the PC market, where its previous-generation Raptor Lake chips suffered from stability issues and newer Arrow Lake chips perform worse than competitors in gaming workloads. The company’s AI business is also struggling, with immature software hindering adoption. A failed Intel 18A process could drag down the stock as investors focus on other AI plays.
Despite the challenges, a turnaround for Intel seems possible if the 18A process delivers on its potential. The company’s valuable manufacturing assets and its position as the only U.S.-based advanced logic semiconductor manufacturer make it an attractive bet. If the stock trades below book value, indicating investor pessimism, buying Intel could be a smart move.
The outcome will depend on the success of Intel 18A, which could begin to drive a comeback as early as this year if delivered on time and meets expectations. However, a disappointing process node could keep Intel’s stock in limbo for the foreseeable future.
Source: https://www.fool.com/investing/2025/01/21/3-massive-risks-for-intel-stock