Remember when chip stock Intel (INTC) was considering shuttering the 18A process in favor of focusing on the 14A process instead? It was a move that got more than a few shareholders very concerned, as it would have represented a major write-down for everything that went into 18A’s development. But now, there are concerns that the 14A process may not be much help to Intel anyway. Intel shares dipped fractionally in Wednesday afternoon’s trading.
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Without “external customers” for the manufacturing division, reports noted, Intel may have to shut down the plant it is currently building in Ohio. It has already announced plans to slow down the construction process as it is, and may have to shut the whole project down altogether without those external customers.
Intel Foundry’s largest customer, as we have seen before, is Intel Products. But Intel Products alone will not be enough to keep Intel Foundry up and running to its fullest, especially with an entirely new plant going in in Ohio. Considering that even Intel Products turns to outside manufacturers in some cases, Intel may have a hard time finding external customers willing to come in and let the 14A process do the work when it is ready in 2027. Intel made it clear recently that it is “still committed to the Ohio One plant,” but needs that market support in order to continue.
Oregon Getting Worried Too
While Ohio is worrying that it may never be part of Intel’s operations, Oregon is increasingly worried about losing the Intel connection it already has. With Intel’s sales in open decline, and processes proving surprisingly expendable, the idea that Intel may not be a chipmaker for much longer is not out of line.
Tirias Research analyst Jim McGregor laid it out, saying, “Intel has two things against it. One is the fact that, a) they’re laying people off; and, b) they don’t really project a positive vision for the company. That’s something that we’re missing from Intel. We need that positive vision from Lip-Bu.” Sadly, “positive vision” seems to be in oddly short supply these days from Intel.
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 three Sells assigned in the past three months, as indicated by the graphic below. After a 33.6% loss in its share price over the past year, the average INTC price target of $22.25 per share implies 10.15% upside potential.
