• Tue. Apr 23rd, 2024

Intel’s Tumultuous Journey: Navigating Losses and Challenges in Chip Manufacturing Operations

BySamantha Nguyen

Apr 3, 2024
Intel’s Foundry Business Continues to Suffer from $7 Billion Operating Loss

On Tuesday, Intel reported significant losses for its chip manufacturing unit Intel Foundry, with a projected loss of $7 billion in 2023. This added to the prior year’s loss of $5.2 billion. Despite a revenue drop of 31% from the previous year, with $18.9 billion in revenue for 2023 compared to $27.49 billion in 2022, Intel announced plans to invest $100 billion into chip factories in four US states as part of the US’s efforts to increase its domestic semiconductor business.

Intel’s American foundry plans were instrumental in securing nearly $20 billion in CHIPS and Science Act funding. CEO Pat Gelsinger expressed optimism about the future of Intel Foundry, despite expecting more losses in 2024 and anticipating that the unit may not break even until 2030. However, these assurances did not prevent a 5% drop in Intel’s shares during trading on Wednesday.

Gelsinger attributed the revenue slide to past missteps, including a decision not to invest in extreme ultraviolet (EUV) machines from Dutch firm ASML. He shared that Intel now buys about 30% of its silicon wafers and emphasized the importance of improving EUV capabilities to bring more production in-house. By doing so, Intel aims to become more competitive in terms of price, performance, and overall leadership.

In addition to announcing its investment plans and addressing past mistakes, Intel also announced it would begin reporting the results of its manufacturing operations as a standalone unit. Gelsinger emphasized the importance of transparency and accountability in this move, highlighting the company’s commitment to addressing past challenges and moving towards a more successful future.

Despite facing significant losses and challenges in its chip manufacturing operations, Intel remains committed to investing heavily into domestic semiconductor production as part of the US’s efforts to increase its global competitiveness in this industry sector.

By Samantha Nguyen

As a content writer at newsqwe.com, I am passionate about crafting engaging and informative articles that captivate our audience. With a background in journalism and a keen eye for detail, I strive to deliver content that is not only well-researched but also adds value to our readers' lives. From breaking news stories to in-depth features, I take pride in my ability to tell compelling stories that resonate with our diverse audience. When I'm not typing away at my keyboard, you can find me exploring new cafes, practicing yoga, or getting lost in a good book. I am thrilled to be a part of the newsqwe.com team and look forward to sharing my love for writing with all of our readers.

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