Intel is pushing a high-stakes dual strategy to turn around its market position and finances in 2025. The stock hovers around $20.25, signaling cautious investor interest in its turnaround plans.
The company’s two-pronged approach: ramp up AI-powered client and data center products for quick wins while building out its ambitious Foundry business to play the contract chip manufacturing game worldwide.
On the AI front, Intel is betting big on PC and data center segments. The Client Computing Group targets shipping over 100 million AI PCs in 2025, powering new CPUs like Panther Lake and Lunar Lake along with fresh launches like Nova Lake-S/U and Wildcat Lake. This could boost average selling prices and margins after $7.6B in Q1 revenue. 
In Data Center and AI, Intel rolled out Xeon 6 processors and Gaudi 3 AI accelerators, driving an 8% YoY revenue jump to $4.1B in Q1. These fast-moving AI products aim to steady the company’s short-term financials amid foundry costs.
On the Foundry side, Intel’s aiming for a comeback with its “five nodes in four years” plan. The new 18A node, featuring RibbonFET transistors and PowerVia power delivery, entered risk production in April. Panther Lake CPUs will be the first to use 18A later in 2025.
Crucial for the foundry push: locking in major clients. Microsoft has already committed to Intel 18A chips, and AWS is onboard for Intel 3 and 18A nodes. Still, the Foundry division ran a $2.3B operating loss in Q1. Intel must hit break-even by 2027 to justify the $18B capital spend planned for 2025.
Analysts forecast a 12-month price target near $21.57, about 7.5% upside from current levels, but sentiment remains cautious with a “Reduce” rating overall.
Investors should watch for:
- Growing AI product sales and margins
- New high-volume foundry contracts and smooth 18A ramp-up
- Steady margin gains heading toward Intel’s 50% goal
These will be key to turning Intel’s dual gamble into a successful turnaround.
“Intel’s journey to redefine its market position and deliver enhanced shareholder value is intricately tied to its ability to execute its dual mandate flawlessly.”
“Near-term successes in the AI PC and data center markets, driven by compelling product innovation, are essential for immediate financial health.”
“They build confidence and provide the resources needed for the longer, more arduous path of establishing a globally competitive and profitable foundry business.”
“Ultimately, consistent and tangible results across both these strategic fronts will be the decisive factor in Intel’s turnaround and its ability to reward patient investors.”
