Intel's stock has been on quite the rollercoaster ride these past few months, and as of today (June 10, 2025), it's showing signs of stabilizing after last week's chip manufacturing announcement. The stock closed at $62.47 yesterday, up 3.2% from last week but still down about 8% from its March high.
I've been following Intel for years, and there's something different about this current phase of their evolution. The company is making bold – some might say desperate – moves to reclaim its former glory in the semiconductor world. Their recent announcement of a $30 billion expansion of their Arizona fabrication facility represents the kind of aggressive investment they've historically been hesitant to make.
"Intel is finally playing offense instead of defense," says Mark Thompson from JP Morgan. "But the question remains whether they're too late to the game."
The global chip shortage has eased considerably since the pandemic years, but Intel now faces a different challenge – staying relevant in a world where specialized AI chips (NVIDIA's territory) and custom silicon (like Apple's) are increasingly dominating the market.
What's particularly concerning for investors (myself included) is how Intel continues to lag behind TSMC and Samsung in manufacturing technology. Their 7nm process – rebranded as "Intel 4" in their new naming scheme – is finally hitting production volumes, but competitors are already shipping 3nm chips in volume.
CEO Pat Gelsinger has been refreshingly candid about these challenges. At last month's investor conference, he admitted, "We took our eye off the ball for several years, and we're paying the price for that now. But I'm confident we're on the right track."
The stock's current valuation (trading at about 15x forward earnings) suggests investors are taking a wait-and-see approach. It's neither priced for failure nor for a dramatic comeback.
For long-term investors with patience, Intel might represent decent value – they still generate substantial cash flow, pay a 3.2% dividend, and have the resources to fund their turnaround. But don't expect quick results – this transformation will take years, not quarters.
