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Intel has a Pretty Big Problem..

TrixP10 said:
worrying times?

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Aug 2 (Reuters) -Intel INTC.O was set to erase nearly $25 billion in market value on Friday in what would be its worst selloff since 2000 after it suspended its dividend and slashed its workforce to fund a costly turnaround for its chip-making business.

Shares of the company were down about 20% in premarket trading after Intel late on Thursday forecast quarterly revenue below estimates and said it was cutting 15% of its workforce, raising worries about its ability to catch up to Taiwan's TSMC 2330.TW and other chipmakers it has fallen behind in recent years.

The Santa Clara company was once the world's leading chipmaker, with the "Intel Inside" logo a valuable marketing feature on personal computers in the 1980s and 90s.

Part of the dot-com era's Four Horsemen - along with Cisco Systems CSCO.O, Microsoft MSFT.O and Dell DELL.N - Intel's stock market value peaked at nearly $500 billion in 2000 before slumping in that year's market selloff and never fully recovering.

It continued to dominate in hefty PC chips, but was caught off foot by the launch of Apple's AAPL.O iPhone in 2007 and other mobile devices that demanded lower power and less pricey processors.

If Friday's losses hold, Intel's market capitalization would fall to about $100 billion, equivalent to less than 5% of Nvidia's NVDA.O and about 40% of Advanced Micro Devices' AMD.O, the two PC chipmakers it heavily dominated for decades until recently.

The selloff was also set to leave Intel worth less than Applied Materials AMAT.O and Lam Research LRCX.O, companies that supply equipment for Intel's fabrication plants.

"Intel has been one of the forgotten horsemen of technology the last couple decades," Michael Schulman, chief investment officer of Running Point Capital said. "Never overtaking its year 2000 highs and struggling to get earnings back to where they were before the AI revolution."
 
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All of these financial summaries inc. The Times (https://www.ft.com/content/f18a35c6-8053-4fde-87b8-a0e2a84307c5) are scathing but don't cover the elephant in the room - 2 years of potentially failling CPUs. How are Intel going to address this. They can't replace the CPU with the original specified CPU because now they have been officially 'downclocked' and have reduced performance. Reimbersement won't cover the cost of M/B's etc. What financial impact will this debacle cost?
 
TrixP10 said:
All of these financial summaries inc. The Times (https://www.ft.com/content/f18a35c6-8053-4fde-87b8-a0e2a84307c5) are scathing but don't cover the elephant in the room - 2 years of potentially failling CPUs. How are Intel going to address this. They can't replace the CPU with the original specified CPU because now they have been officially 'downclocked' and have reduced performance. Reimbersement won't cover the cost of M/B's etc. What financial impact will this debacle cost?
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consumers are going to get shafted royally , ive accepted this just waiting for it
 
TrixP10 said:
for those who have a faulty CPU will a full refund be possible.
Intel Q2 2024 earnings pretty grim.
breakingthenews.net

Intel's Q2 revenue down 1% to $12.8 billion

Intel Corporation revealed on Thursday that its revenue in the second quarter of fiscal 2024 came in at $12.8 billion, edging down 1% on an annual basis.In the reported three-month period, net loss st...
breakingthenews.net breakingthenews.net
wccftech.com

Intel Q2 2024 Earnings: A Horrendous Result With A Miss On Total Revenue, DCAI, Gross Margin, And EPS

Intel has now announced its earnings for the second quarter of 2024, posting broadly negative results relative to the consensus expectations. Intel (NASDAQ: INTC) Earnings Release for the Second Quarter of 2024 For the three months that ended on the 30th of June, 2024, Intel reported $12.833...
wccftech.com wccftech.com
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It's very grim considering were in the middle of an A.I. goldrush and nobody wants to buy a shovel from Intel.

I would love to see what Intel considers it's Risks & Opps are, can't help but feel there still an old guard there that thinks everything will be alright and they can get through this on name recognition alone as AMD will never be able supply the likes so Dell and Lenovo with enough processors to supply to all their corporate customers in the same quantity that Intel can.
 
Chud_Jenny said:
Aug 2 (Reuters) -Intel INTC.O was set to erase nearly $25 billion in market value on Friday in what would be its worst selloff since 2000 after it suspended its dividend and slashed its workforce to fund a costly turnaround for its chip-making business.

Shares of the company were down about 20% in premarket trading after Intel late on Thursday forecast quarterly revenue below estimates and said it was cutting 15% of its workforce, raising worries about its ability to catch up to Taiwan's TSMC 2330.TW and other chipmakers it has fallen behind in recent years.

The Santa Clara company was once the world's leading chipmaker, with the "Intel Inside" logo a valuable marketing feature on personal computers in the 1980s and 90s.

Part of the dot-com era's Four Horsemen - along with Cisco Systems CSCO.O, Microsoft MSFT.O and Dell DELL.N - Intel's stock market value peaked at nearly $500 billion in 2000 before slumping in that year's market selloff and never fully recovering.

It continued to dominate in hefty PC chips, but was caught off foot by the launch of Apple's AAPL.O iPhone in 2007 and other mobile devices that demanded lower power and less pricey processors.

If Friday's losses hold, Intel's market capitalization would fall to about $100 billion, equivalent to less than 5% of Nvidia's NVDA.O and about 40% of Advanced Micro Devices' AMD.O, the two PC chipmakers it heavily dominated for decades until recently.

The selloff was also set to leave Intel worth less than Applied Materials AMAT.O and Lam Research LRCX.O, companies that supply equipment for Intel's fabrication plants.

"Intel has been one of the forgotten horsemen of technology the last couple decades," Michael Schulman, chief investment officer of Running Point Capital said. "Never overtaking its year 2000 highs and struggling to get earnings back to where they were before the AI revolution."
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Wow, they are being absolutely hammered in the stock market.
 
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Doggie2k said:
I do hope the board plan to sack themselves along with the 20% of the work force.
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Naturally that is not how things work!

For compulsory, it's often those who are good at their job but poor at internal politics - since they are too busy doing work!

For voluntary, those who have played internal politics well are unlikely to volunteer since they have it cozy.

In both cases, a large number of the people they actually need to stay will leave.

While throwing money at problems seldom works, engaging in share buybacks like Intel did for years is just an admission that they have new ideas outside there comfort zone. And the board and others with shares or share options were probably the cheerleaders for buyback.

(But anyone looking at Intel's attempts to diversify over the decades... Well maybe share buybacks was better than most of those ventures?!)
 
Chud_Jenny said:
Aug 2 (Reuters) -Intel INTC.O was set to erase nearly $25 billion in market value on Friday in what would be its worst selloff since 2000 after it suspended its dividend and slashed its workforce to fund a costly turnaround for its chip-making business.

Shares of the company were down about 20% in premarket trading after Intel late on Thursday forecast quarterly revenue below estimates and said it was cutting 15% of its workforce, raising worries about its ability to catch up to Taiwan's TSMC 2330.TW and other chipmakers it has fallen behind in recent years.

The Santa Clara company was once the world's leading chipmaker, with the "Intel Inside" logo a valuable marketing feature on personal computers in the 1980s and 90s.

Part of the dot-com era's Four Horsemen - along with Cisco Systems CSCO.O, Microsoft MSFT.O and Dell DELL.N - Intel's stock market value peaked at nearly $500 billion in 2000 before slumping in that year's market selloff and never fully recovering.

It continued to dominate in hefty PC chips, but was caught off foot by the launch of Apple's AAPL.O iPhone in 2007 and other mobile devices that demanded lower power and less pricey processors.

If Friday's losses hold, Intel's market capitalization would fall to about $100 billion, equivalent to less than 5% of Nvidia's NVDA.O and about 40% of Advanced Micro Devices' AMD.O, the two PC chipmakers it heavily dominated for decades until recently.

The selloff was also set to leave Intel worth less than Applied Materials AMAT.O and Lam Research LRCX.O, companies that supply equipment for Intel's fabrication plants.

"Intel has been one of the forgotten horsemen of technology the last couple decades," Michael Schulman, chief investment officer of Running Point Capital said. "Never overtaking its year 2000 highs and struggling to get earnings back to where they were before the AI revolution."
Click to expand...

Yeah, they are now worth less than half of what AMD are.

r8UJY1q.png
 
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As funny as it is, assuming they don't need the money any time soon, they should probably just sit tight. Intel isn't a small fly by night, boom and bust kind of thing, and are very unlikely to end up becoming insolvent any time soon. The stock price will likely bounce back at some point. So who knows maybe they'll get lucky and in a years time they might get their money back
 
StarShock said:
As funny as it is, assuming they don't need the money any time soon, they should probably just sit tight. Intel isn't a small fly by night, boom and bust kind of thing, and are very unlikely to end up becoming insolvent any time soon. The stock price will likely bounce back at some point. So who knows maybe they'll get lucky and in a years time they might get their money back
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One might argue Intel are too big to fail, they are not, no one is, Nokia used to think that, if this trend doesn't change, drastically Intel will run out of money and rack up debts, they are already $53 billion in debt, if they rack up much more of it they will not be able to service that debt and that's when it all goes wrong.

I don't think Intel are in any peril yet.
 
AMD have zero debt, they paid it all off, with cash. They have a $240 Billion pot of money they could tap in to if they wanted to, so far they have left that well alone, personally i think they should tap a couple Billion off the top of it to pay for some much needed development and competitive war waging.
 
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