Source: Wall Street See
Author: Zhuang Lijia.

$Intel (INTC.US)$ Tuesday became the focus of the market's attention, with Wall Street paying close attention to several key announcements regarding the business of this semiconductor company, including the latest progress of its foundry plans.

Intel announced on Monday morning that it is eligible for up to $3 billion in funding from the U.S. government for chip manufacturing for the military. Intel also delayed its new factories in Germany and Poland, but remains committed to expansion in Arizona, New Mexico, Oregon, and Ohio in the United States; the construction projects in Poland and Germany will be temporarily suspended for approximately 2 years based on market demand. Intel stated that another factory in Malaysia will be completed, but it will only be put into operation if conditions support it.

In addition, Intel will establish Intel Foundry Services (IFS) as an independent division. In order to attract more customers, Intel plans to separate the foundry business from its other businesses and make it a wholly-owned subsidiary. This move aims to demonstrate to potential customers that IFS is an independent supplier, especially for those companies that compete with Intel, so that they can collaborate with Intel with more confidence.

KeyBanc analyst John Vinh stated that these announcements, including the decision to suspend construction of the German and Polish factories, are primarily aimed at cost reduction rather than growth recovery. Nevertheless, he is still "very encouraged" by these updates, as he believes they demonstrate proactive control of investment by Intel's management, primarily in terms of cost.

John Vinh further commented that Intel's decision to establish its foundry business as a separate subsidiary is also positive, as it will reduce conflicts of interest between the chip foundry business and chip design business. John Vinh maintains a "Sector Weight" rating on Intel.

Intel, which is listed on the Intel (INTC.US) market, was the focus of today's market, and Wall Street was focused on several key announcements about the company's business, including the latest progress of its foundry plan.

The view of Evercore analyst Mark Lipacis is similar to that of John Vinh. He believes that these latest updates are positive, but not enough to change his view of Intel's development trajectory. Mark Lipacis said, "We believe that these developments are gradual positive factors, but until there is increased visibility on their chip foundry business, we still maintain an 'In-Line' rating on the stock."

Mark Lipacis believes that Intel will be able to narrow the gap with Taiwan Semiconductor (TSM.US) and provide a customer experience that makes it easy for companies like Apple, AMD (AMD.US), and Nvidia (NVDA.US) to choose it in competition, but this may "take a long time to achieve."

Bank of America analyst Vivek Arya suggests that Intel's statement about producing chips for Amazon AWS may not be as impressive as it initially sounds. In a report, Vivek Arya stated, "Intel has been providing CPUs to AWS for a long time, so customization is nothing new, and the victory of artificial intelligence architecture in 18A may only come into play from 2026, while also competing with Broadcom (AVGO.US) and other companies' Ethernet switches." Vivek Arya maintains a 'shareholding' rating for Intel with a target price of $21.

Editor/rice