INTEL ($INTC) – BOUNCING BACK OR STUCK IN TRANSITION?

INTEL (INTC) – BOUNCING BACK OR STUCK IN TRANSITION?

(1/9)
Q4 2024 revenue beat forecasts at 14.3B (vs. 13.8B est.), up 7% from Q3 but still -7% YoY—highlighting Intel’s ups and downs. Looking ahead? Q1 2025 guidance points to $11.7-12.7B in revenue and break-even EPS, hinting continued headwinds. Let’s dive in! 🔎

(2/9) – EARNINGS SNAPSHOT


• Q4 non-GAAP EPS: $0.13 (beat by $0.01), down sharply from $0.54 a year ago
• GAAP earnings hurt by 15.9B in impairment + 2.8B restructuring charges
• Gross margin set to drop from 42.1% to 36% next quarter—Ouch!

(3/9) – SIGNIFICANT FINANCIAL EVENTS

• Exploring AI chip partnership w/ TSMC: Could bolster Intel’s AI presence
• Targeting 110B in cost cuts by 2025, citing big strides in Q3 2024
• Foundry services sees 4.5B revenue in Q4, improved operating loss due to EUV wafer mix—positive sign ⚙️

(4/9) – CONTEXT & CHALLENGES

• 2024 free cash flow: - 15.1B (vs. +21.4B in 2020)—hurts liquidity 💸
• Declining YoY revenue + margin pressure reflect stiff competition & big CapEx
• Intel pivoting to AI & foundry services, but near-term growth remains sluggish

(5/9) – SECTOR COMPARISON

• Forward P/E ~16, trailing P/E ~72.50 = low profitability vs. AMD/NVIDIA’s sky-high multiples
• P/B ~1.06, P/S ~1.5-2 → Intel looks “cheap” compared to peers (e.g., NVIDIA P/S ~20+!)
• Stock’s -51.67% over the last year, underperforming the semiconductor sector (+96.5%) 😬

(6/9) – UNDERVALUATION OR VALUE TRAP?

• Analysts’ intrinsic value: ~$19.37-$31.27 vs. current ~$20.97 → near fair value or slightly undervalued 🤔
• But big risks: negative cash flow, competitive drubbing from AMD/NVIDIA, repeated delays…
• The market’s discount might be warranted given Intel’s execution hurdles

(7/9) – KEY RISKS

• Competitive Pressures: AMD & NVIDIA dominating AI/data center 💻
• Execution Delays: Roadmap slips for Panther Lake (2H 2025) & Clearwater Forest (2026)
• Financial Strain: High CapEx, negative FCF, suspended dividend in 2024 🚧
• Macro & Geopolitics: Trade tensions (esp. in China) + economic headwinds

(8/9) – SWOT HIGHLIGHTS

Strengths:
Established brand, PC/server CPU leader
Foundry expansion, AI PC push
Cost cuts boosting operational efficiency

Weaknesses:
Market share losses, negative FCF
Delays in product launches, high CapEx
Complex design + manufacturing model

Opportunities:
AI & foundry growth via TSMC tie-ups
Government support (CHIPS Act)
Undervaluation if turnaround succeeds

Threats:
Fierce competition (AMD, NVDA)
Regulatory & trade risks (China)
Rapid AI market evolution leaving Intel behind

(9/9) Is Intel the next big turnaround story or a sinking ship?

1️⃣ Massive comeback—AI + foundry = unstoppable!
2️⃣ Meh—They’ll recover somewhat, but not lead the pack
3️⃣ Doom—Delays, negative FCF, stiff competition… pass

Vote below! 🗳️👇