Intel Stock (NASDAQ:INTC) Trades at $22.49 with Up to 176% Upside as Foundry Strategy Shifts to 14A
With Wall Street targets ranging from $14 to $62, Intel's pivot from 18A to 14A may redefine its competitive edge—but will it deliver? | That's TradingNEWS
Intel (NASDAQ:INTC) Confronts Its Foundry Future Amid Restructuring and Losses
CEO Lip-Bu Tan's Shift from 18A to 14A Signals Tactical Pivot
Intel Corporation (NASDAQ:INTC) rose 2.79% to $22.49 amid swirling speculation that CEO Lip-Bu Tan is engineering a strategic redirection of the company’s troubled foundry ambitions. Sources indicate the company may cease external marketing of its 18A chip process, instead focusing on accelerating the 14A node. Intel will still fulfill current 18A-based commitments to Microsoft and Amazon, but new client onboarding is likely halted. If confirmed, this could lead to a write-off approaching $1 billion. The decision will reportedly be formalized in Intel’s fall board meeting.
14A Node Emerges as the Battleground to Compete with TSMC
Under Tan’s leadership, Intel appears poised to abandon its expansive 18A rollout and aggressively promote its 14A technology, a move designed to win contracts from major chip buyers like Apple (AAPL) and Nvidia (NVDA). The 14A process, projected to enter risk production by 2026, is expected to provide both cost and performance improvements over TSMC’s advanced N2 process. Analysts at UBS affirm that 14A offers broader process windows and more robust PDKs, making it attractive to potential clients. Nonetheless, the transition comes with execution risk and uncertainty over customer adoption.
Write-Down Looms as Intel Recalibrates Its Roadmap
Intel’s potential withdrawal from 18A for external foundry customers marks a major deviation from the ambitious "five nodes in four years" plan. Panther Lake processors, built on 18A, are still expected to ship internally in 2025, but the overall commitment to commercialize 18A externally appears to be winding down. Market chatter pegs the financial impact of this move between several hundred million to over $1 billion in write-downs. This development follows a brutal 2024 in which Intel posted an $18.8 billion net loss—its first unprofitable year since 1986.
Intel Eyes Profit Restoration Through Cost Cuts and Focus
To stabilize its deteriorating financial base, Intel is targeting sweeping cost reductions, including up to a 20% factory workforce cut and an operating expense reduction plan that aims to save $17 billion in 2025 and $16 billion in 2026. The company’s Q1 2025 revenue stood flat at $12.7 billion, while EPS fell to $0.13 from $0.18 YoY. Intel’s Data Center & AI segment showed some promise due to demand from select hyperscalers, but Q2 is projected to weaken with estimated revenue of $11.88 billion and EPS of just $0.01. Full-year revenue is forecast to decline by 5.1% to $50.4 billion.
INTC Price Targets and Valuation Diverge Across Analysts
Wall Street remains divided on NASDAQ:INTC valuation. Of the 38 analysts covering the stock, only one assigns a “Strong Buy,” 32 suggest “Hold,” and five opt for “Strong Sell.” The average target price is $21.35, implying 5% downside from the current $22.49. However, the highest estimate pegs a 12-month price at $62, suggesting upside potential of 176%. GuruFocus estimates Intel’s fair value at $23.86, a 6.1% upside from the current level. UBS and Mizuho maintain Neutral stances, with targets of $21 and $23, respectively.
Intel's Foundry Gamble Faces Skepticism from Wall Street
Morgan Stanley analysts led by Joseph Moore suggest Intel’s foundry pivot to 14A may not significantly disrupt near-term earnings, as most 18A external engagements were minor. Still, they stress that Intel’s journey to profitability will be long and uncertain. Moore maintains an Equal-weight rating with a $23 target, closely aligning with current pricing. He notes that while execution delays on AI and foundry milestones into 2027 may be necessary, they don’t change the fundamental thesis that INTC remains in turnaround mode.
Operational Streamlining: Substrate Exit and Nokia Partnership
Intel is reportedly preparing to exit its glass substrate initiative, further streamlining focus onto chip development and server infrastructure. Meanwhile, its collaboration with Nokia leverages Intel Xeon processors to improve 5G efficiency. The company has also promoted Greg Ernst to Chief Revenue Officer and continues to support Mobileye’s radar system rollout for automated vehicles by 2028. These changes align with Tan’s intent to slim down Intel's breadth and improve ROI across divisions.
INTC Technical Snapshot: Bounce or Breakdown?
At $22.49, NASDAQ:INTC sits below its 200-day EMA but has reclaimed short-term support. A push above $23.10 would open the door toward $24.80, while support lies at $21.20 and $20.40. Volume remains below average, suggesting indecision. Momentum indicators are flat, with RSI near 49 and MACD still below the signal line, indicating no clear trend. A breakout would require strong volume follow-through and positive earnings confirmation on July 24.
BUY/SELL/HOLD VERDICT: Tactical HOLD – Awaiting Confirmation
The shift to 14A may be a prudent long-term decision, but execution and client traction remain uncertain. With the stock trading near fair value and earnings on deck, upside is possible but unconfirmed. Hold the line until clarity emerges from Intel’s Q2 earnings and board direction on its foundry pivot.
