Intel ( INTC ) shares closed down this week after disappointing investors with its latest financial outlook. The next catalyst for the stock could be just days away.
Lip-Mou Tan hosted the chip company’s first quarterly earnings call as CEO on Thursday, and he will deliver a keynote address on Tuesday at an event related to Intel’s foundry business, which makes chips for other companies. Bank of America analysts said in a note on Friday that the event could also feature announcements of partnerships with other large tech companies.
Intel has been committed to growing its foundry business; early last year, the company said it planned to become the world’s second-largest foundry after TSMC ( TSM ) by 2030. However, its 2024 foundry revenue fell from the previous year — to about $17 billion, or about 30% of the company’s total revenue — and its operating losses widened.
Reports emerged this year that Intel could consider selling a stake in its foundry business to TSMC; however, TSMC denied the talks. Investors have been eyeing the possibility of a spinoff or sale of the foundry business long before Chen took over.
Investors are still looking for signs of a deal. Optimism over a range of possibilities, from a possible wholesale sale to a possible one, has driven the company’s stock price in recent months.
That could still be the case. But Tan said cost cutting is also a priority: On Thursday, while he stopped short of formally announcing the layoffs reported earlier this week, he made it clear they were coming.
Bank of America analysts have a neutral rating on Intel shares and a $23 price target, a few cents above the Wall Street consensus compiled by Visible Alpha. They say Intel is “too large to turn around quickly, but selectiveness remains.”
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