SANTA CLARA, Calif. — Intel Corporation (NASDAQ: INTC), a titan of the semiconductor industry, is undergoing a seismic transformation as it grapples with financial losses, competitive pressures, and geopolitical headwinds. On April 23, 2025, reports surfaced that Intel plans to lay off more than 20% of its workforce—potentially over 21,000 employees—in a bid to streamline operations and eliminate bureaucratic inefficiencies, according to Bloomberg News and Reuters. This drastic move, one of the largest in the company’s history, comes as new CEO Lip-Bu Tan, appointed last month, seeks to reposition Intel in the fiercely competitive artificial intelligence (AI) and foundry markets. As Intel prepares to release its Q1 2025 earnings today, April 24, investors and industry watchers are bracing for a pivotal moment in the company’s storied 57-year legacy.
Founded in 1968 by Gordon Moore and Robert Noyce, Intel revolutionized computing with its microprocessors, becoming synonymous with personal computing through its x86 architecture. By the 1990s, Intel’s chips powered the majority of PCs, and its “Intel Inside” campaign cemented its brand. The company expanded into memory chips, networking, and autonomous driving through acquisitions like Mobileye, acquired for $15.3 billion in 2017, and Altera, purchased for $16.7 billion in 2015.
However, Intel’s dominance has waned in recent years. The rise of mobile computing, led by ARM-based chips from competitors like Qualcomm, eroded Intel’s PC-centric market share. Meanwhile, Nvidia’s GPUs and CUDA platform captured the AI boom, leaving Intel’s GPU efforts, such as the canceled Falcon Shores project, struggling to gain traction. Intel’s foundry ambitions, aimed at competing with Taiwan Semiconductor Manufacturing Company (TSMC), have incurred steep losses, with the Intel Foundry segment reporting a $7 billion operating loss in 2024.
Under former CEO Pat Gelsinger, who stepped down unexpectedly in 2024, Intel pursued an aggressive “five-nodes-in-four-years” manufacturing plan, culminating in the Intel 18A process. While this technology promises cutting-edge performance for chips like Panther Lake (PCs) and Clearwater Forest (servers), Intel’s stock has plummeted 45% from its 52-week high, closing at $19.25 on April 16, 2025, per Markets Insider. The company’s market capitalization stands at $66.72 billion, a far cry from its peak valuation. Posts on X reflect investor frustration, with users
Intel’s Q1 2025 earnings, due today, are expected to show a year-over-year decline in earnings and revenue, according to Yahoo Finance. Analysts predict a challenging quarter, with sales dropping to $53.1 billion in 2024, a 2% year-over-year decline. The Zacks Consensus Estimate for Q1 2025 is unavailable, but the earnings report could lift the stock if Intel exceeds expectations, as it has not missed an earnings estimate in recent quarters. “The earnings report… might help the stock move higher if these key numbers are better than expectations,” Yahoo Finance noted.
Despite a grim outlook, Intel’s stock rallied 2.8% on April 22, outpacing the S&P 500’s 2.5% gain, after U.S. Treasury Secretary Scott Bessent hinted at de-escalating U.S.-China trade tensions, per Yahoo Finance. This is critical for Intel, which faces AI export challenges under new U.S. licensing rules targeting China, as reported on April 18. China’s 125% retaliatory tariffs on U.S. goods, noted by CNBC, further complicate Intel’s 27% revenue exposure to the Chinese market.
Intel faces formidable challenges. Nvidia’s dominance in AI, bolstered by its CUDA ecosystem, is a high barrier, as former CEO Gelsinger acknowledged on Yahoo Finance’s Opening Bid. Intel’s Jaguar Shores GPU, focused on AI inference, aims to compete, but market traction remains elusive. The foundry business, while ambitious, is years from profitability, with analysts like those at The Motley Fool cautioning that losses could persist through 2027.
Geopolitical risks are equally daunting. The Trump administration’s tariffs, initially proposed at 145% on Chinese imports, have unsettled markets, though recent signals of moderation offer relief. “Trump signals tit-for-tat China tariffs may be near end,” Reuters reported on April 18, a development that could ease pressure on Intel’s supply chain. Still, China’s vow to retaliate against countries aligning with U.S. trade policies, per The Guardian, adds uncertainty.
Yet, opportunities abound. The global semiconductor market is projected to grow to $707 billion in 2025, driven by AI and high-performance computing, per MarketsandMarkets. Intel’s focus on AI inference and its foundry expansion align with these trends. TipRanks reports that 31 analysts offer a 12-month price target averaging $25, suggesting a 30% upside from current levels.
Oppenheimer’s “Outperform” rating reflects confidence in Tan’s vision.
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