Intel Corporation (INTC)

“Overall, CCPG is likely to be up a bit, but I think it will be driven by good growth on the edge and client will be flattish.”

“I'd say as we look into next quarter, probably on a revenue basis, it's going to be kind of flattish for us.”

“At the midpoint of $16.3 billion, we forecast gross margin of 42%, a tax rate of 11% and EPS of $0.38, all on a non-GAAP basis.”

“we're guiding Q3 revenue to a range of $15.8 billion to $16.8 billion.”

“Q3 quarter-to-date 18A yields are trending ahead of targets set in March.”

“gives us some real confidence that this is going to be well north of a double-digit CAGR for us in terms of growth rate over the next few years.”

“I would point out that while things will improve, we will not catch up. We will be behind in the fourth quarter.”

“our #1 goal this year, which everyone in finance here can attest to because I was a dog with a bone on this was to get gross margins comfortably into the 40s in every quarter.”

“We remain on track for 14A risk production for our internal products in second half of 2027, and we make the decision in Q2 to fully committed to high-volume ramp in 2028.”

“I would say that today, we're probably running at about a $2 billion run rate or at least approaching a $2 billion run rate for that business. We think in the not-too-distant future, we'll be at a $4 billion run rate for that business.”

“I did want to give investors at least a line of sight to expect that the number will be up.”

“We'll increase tooling in '26 by 40% relative to '25.”

“I mean longer term, I think we'd expect that to be some of the fall-through somewhere in the 40% to 60% range.”

“we start to see some of the logjam break towards the end of the third quarter, which is why we're more flattish this quarter, but see upside in the fourth quarter.”

“That said, yes, I mean, of course, if we are able to start to see inventory improve or supply improve towards the end of the third quarter and into the fourth quarter, we would expect a lift from that.”

“As yields improve on 18A further, we do expect margins to improve on Panther Lake, and they will be above the corporate average, and that will help start lifting the margins there.”

“we likely would see some build in CPUs for Q3. And then Q4, I think it will be -- we'll start to experience that in our own business and be soft.”

“we're forecasting 2027 capital expenditures to be significantly above the 2026 levels with the vast majority spent across our U.S. network.”

“we're raising our outlook for 2026 and now expect our CapEx to be more than $20 billion, which is up significantly versus our expectations entering the year.”

“we expect noncontrolling interest or NCI, to net to approximately $250 million in each of Q3 and Q4 of this year and be approximately $1.1 billion for '27 and '28 on a GAAP basis.”

“We continue to tightly manage non-GAAP operating expenses to roughly $16.5 billion for the year.”

“supply remains very tight and the near-term linearity of our supply growth is more skewed towards the end of Q3 and into Q4, especially for servers.”

“We stepped up investments in Q2 for Intel 14A to prepare for risk production in 2027 and committed high-volume ramps in 2028.”

“Intel Foundry has driven down the cost of our primary Panther Lake SKU by roughly 50% year-to-date and is on track for an additional 20% this year with further meaningful reductions planned in 2027.”

“we focused on ramping the technology into high volume and high quality to support customer ramps in 2027.”

“we may need to tap the capital markets to drive some more investment.”

“That could be a drag to gross -- to cash flow next year and make getting it to a positive number a little bit more challenged.”

“I would just say Lip Bu had a target as we came into the year for the end of this year, and we are probably going to hit that around the middle of this year.”

“We remain committed to retiring all $2.5 billion of maturities as they come due this year and all $3.8 billion in 2027.”

“From a modeling perspective, whatever we get to in February is probably what we run the rest of the year roughly. So it is going to be kind of flattish from Q2 onward from a revenue perspective—at least that is how we are modeling it.”

“Supply will go up in the second quarter. It is going to go up every quarter now going forward.”

“We have more work to do at the foundry level to drive gross margins to where we want to be—that is going to be multiple quarters before we get those to be foundry-average gross margins—but it is tracking better than we expected, which is good.”

“We would expect this to be at least at foundry average gross margins over time.”

“As it relates to external customers on the foundry side, our expectation—which we have been pretty consistent on for about a year—is that customer signals would be more concrete in the back half of this year and into early next year.”

“In fact, tool spending will be up year-over-year ~25% or so.”

“Let me unpack CapEx just for a minute. We are now calling it flat year-over-year.”

“Lastly, excluding the buyout of the Fab 34 joint investment, we still expect positive adjusted free cash flow for the full year.”

“As a result, we now expect noncontrolling interest, or NCI, to net to approximately $250 million in each of Q2, Q3, and Q4 of this year, and be approximately $1.1 billion for 2027 and 2028, on a GAAP basis.”

“We now expect expenditures to be roughly equal across the year and still to be heavily weighted towards the equipment that directly grows wafer outs to support growth this year and next.”

“We forecast capital expenditures in 2026 to be flat to last year versus our prior expectation of flat to down, reflecting increased capacity investments to support committed demand and a continued emphasis on improving fab productivity and output.”

“For OpEx in 2026, we had been directionally targeting $16 billion but are likely to be higher due to inflationary pressures, variable compensation, and targeted investments we are making to capture the opportunities ahead.”

“With that said, Intel 18A is still early in its ramp, and rising input costs, especially in memory, present growing headwinds in the second half that we need to overcome.”

“We also expect 2026 revenue on a half-on-half basis to follow the seasonal trends experienced over the last ten years, with servers above and PCs below.”

“Our outlook for server CPU demand has improved over the last 90 days, and we expect a strong year of double-digit unit growth for the industry and for us, with momentum extending into 2027.”

“We are prudently planning for PC demand to weaken in the second half of the year and expect the full-year PC unit TAM to be down low double-digit percent, in line with industry peers and experts.”

“This expansion will help support the committed demand that will begin to convert to revenue in 2027.”

“As a reminder, Intel Foundry carries the bulk of the cost associated with the early ramp of Intel 18A, and we expect Intel Foundry’s operating loss to improve through the year as 18A continues to ramp into volume and yields improve further.”

“We expect to see earlier design commitments emerge beginning in 2026 and expanding into 2027.”

“Even as we improve factory output, demand continues to run ahead of supply for all our businesses, especially for Xeon server CPUs where we expect sustained momentum this year and next.”

“I do believe that the first quarter is the trough. We will improve supply in the second quarter.”

“We're reasonably confident that there's a good trajectory there.”

“I think on the yield improvement, which we see in the 7%, 8% yield improvement per month.”

“Our share count is forecast to be 5.1 billion shares in Q1 and grow in line with our stock-based compensation going forward.”

“I think we will make great strides on the supply as we progress through the year.”

“So in terms of 14A, realistically in terms of, I call it, the risk production in the later part of 2027 and real production, volume production in 2028.”

“Yes, I mean, we would expect to be better than seasonal through the year if we can get the supply to where we think we can as we get into 2Q. So that's correct.”

“I'd say some of the early customer engagements suggest that we'll be well north of $1 billion on many of these opportunities for advanced packaging.”

“We think that the second half of this year, they're going to indicate to us what kind of capacity firm commitment so that we can deploy the capacity CapEx to really build that.”

“We know that 34.5% is by no means an acceptable level of gross margins. And we're actively working it, first to get it to 40% and then once we get it there, we'll move to a new target.”

“I think as we progress through the year, the 2 things should benefit us. One, we improve our supply, ergo, that should improve our revenue picture. On top of that, Panther Lake's cost structure gets better and better.”

“We've talked about, the likelihood is, our customers on 14A their window to secure or for us to secure them will be in the back half of this year and in the first half of next year. And so once visibility improves there, we'll start to unlock the spend on 14A.”

“Like I said, we think we -- things will certainly improve in 2Q but we won't be completely out of the woods here. But as we progress through the year, we think things will get better and better.”

“So we are ramping up tool spending quite a bit in '26 relative to '25 to address this supply shortfall as well.”

“We expect to generate positive adjusted free cash flow for the full year, and we're planning to retire all $2.5 billion of maturities as they come due this year.”

“Previously, we said CapEx would be down, but are now planning for a range of flat to down slightly and for expenditures to be more weighted to the first half.”

“NCI is expected to grow meaningfully again in fiscal 2027.”

“We expect noncontrolling interest or NCI to net to approximately $325 million in Q1 and be approximately $1.2 billion for the year on a GAAP basis.”

“For OpEx, we target 2026 operating expenses of $16 billion.”

“Within the server market, customer feedback and our own market intelligence points to the likelihood of a strong year of growth for DCAI.”

“First, from a revenue perspective, we expect our factory network to improve available supply beginning in Q2 and for each of the remaining quarters in 2026.”

“We are focusing on improving quality and yield to support customer desire for ramps beginning in second half of 2026.”

“Demand for traditional servers continues to be very strong, and we are focused on ramping available capacity to support the meaningful uptick we are seeing including partnering with key customers to support their needs beyond 2026.”

“Yes. I think on the Lunar Lake side, I think we've got what we need based on the current forecast, of course, that could always tick up, and then we would need more memory which would kind of impact gross margins.”

“We are on track to bring Panther Lake to market this year.”

“We would expect to be somewhere in that range. Obviously, there's an error bar around that. It might be a little bit less or a little bit more than that.”

“We continue to anticipate 2025 gross capital investment will be approximately $18 billion, and we expect to deploy more than $27 billion of CapEx in 2025 versus $17 billion deployed in 2024.”

“We expect noncontrolled income to be approximately $350 million to $400 million in Q4 on a GAAP basis, and we forecast average fully diluted share count of roughly 5 billion shares for Q4.”

“We forecast a tax rate of 12% and EPS of $0.08, all on a non-GAAP basis.”

“At the midpoint of $13.3 billion, we forecast a gross margin of approximately 36.5%, down sequentially due to product mix, the impact of the first shipments of Core Ultra 3, which has the typically higher cost you see in the early stages of a new product ramp and the deconsolidation of Altera.”

“For all other, which now excludes Altera, we expect revenue to decline consistent with Mobileye's guidance, partially offset by sequential growth in IMS.”

“We expect Intel Foundry revenue up quarter-over-quarter on increased Intel 18A revenue and its external foundry revenue up due to the deconsolidation of Altera.”

“Within Intel products, we expect CCG to be down modestly and PC AI to be up strongly sequentially as we prioritize wafer capacity for server shipments over entry-level client parts.”

“We expect Intel products up modestly sequentially but below customer demand as we continue to navigate supply environment.”

“At the midpoint, and adjusting for the Altera deconsolidation, Q4's revenue is roughly flat quarter-over-quarter.”

“For Q4, we're forecasting a revenue range of $12.8 billion to $13.8 billion.”

“The team executed well to support upside in the quarter given the current tight capacity environment, which we expect to persist into 2026.”

“We expect NVIDIA's $5 billion investment to close by the end of Q4.”

“we are on track to launch our first Panther Lake SKU by year-end, followed by additional SKUs in the first half of next year.”

“Our Intel 18A family is the foundation for at least next 3 generation of client and server products.”

“I think as you get beyond a few years, that rolls off and will also help.”

“As we get into 14A, our cadence will be more normalized. And so you won't see so much start-up costs stacked on top of each other, which is affecting gross margins.”

“We're obviously at our infancy. What I'm saying is relative to the CapEx plan, it's not like we're going to incrementally add supply for 18A next year.”

“As you think about investment, we still think that $16 billion of OpEx investment for next year is the right amount.”

“I do agree. We should see gross margins improve on the foundry side for sure.”

“I'd say, we still believe in this 40% to 60% fall-through for margins.”

“we're prudently preparing for another year of strong demand in 2026 as Core Ultra 3 ramps into a healthy PC ecosystem.”

“we will continue prioritizing deleveraging by paying maturities as they come due in 2026.”

“Looking ahead, we plan to launch successive generation of inference-optimized GPUs on the annual cadence that features enhanced memory and bandwidth to meet enterprise needs.”

“And it looks like things are going to be stronger this year, and probably that continues well into next year.”

“So I'm not sure we'll buck the trend on seasonality given the fact that we're going to be really, really tight in the first quarter. After that, I think we'll start to see some improvements, and we can get ourselves caught up as we get through the rest of the year.”

“We are on track to implement our return-to-office mandate starting September.”

“We expect a pretty significant ramp in Lunar Lake in the third quarter.”

“Beginning the process of delevering our balance sheet in 2025 remains a top priority for us.”

“We anticipate 2025 gross capital investment will be approximately $18 billion and forecast $8 billion to $11 billion for net CapEx.”

“We expect noncontrolled income, or NCI, to be approximately $250 million to $300 million in both Q3 and Q4 on a GAAP basis.”

“At the midpoint of $13.1 billion, we expect a gross margin of approximately 36% on an increased mix of outsourced products, the early ramp of Panther Lake and increased costs associated with tariffs.”

“We expect Intel Foundry revenue down slightly quarter-over-quarter due to capacity constraints in Intel 7, which we expect to persist through the second half of the year and reduced expectations for external advanced packaging revenue.”

“remain focused on beginning the process of delevering this year as cash from operations continues to improve.”

“We expect the principal cash costs associated with the restructuring charges to land in Q3 '25.”

“Granite Rapids is ramping as planned, and we continue to see good demand for our more established server products, but sustainable share improvement in this market will take time.”

“In client, our top priority is delivering our first Panther Lake SKU by year-end. followed by additional SKUs in the first half of 2026.”

“Our foundry and product teams remain focused on enabling Panther Lake to launch this year.”

“On Intel 18A, we will continue to make steady progress on our yield and performance targets.”

“We will further slow the pace of construction in Ohio to ensure our spending is aligned with market demand.”

“During Q2, we completed the majority of the actions needed to achieve our year-end target of 75,000 employees.”

“While difficult, these decisions have us firmly on track to meet our calendar year 2025 and calendar year 2026 OpEx targets of $17 billion and $16 billion, respectively.”

“The increase in capital cost at Intel 14A, make it clear that we need both Intel products, and a meaningful external customer to drive acceptable returns on our deployed capital, and I will only invest when I'm confident those returns exist.”

“Going forward, we will grow our capacity based solely on the volume commitments and deploy CapEx in lockstep with the tangible milestones and not before.”

“We actually won't get to peak volumes on 18A until probably the beginning of the next decade.”

“On the 14A, same as A14 from TSMC, the timing is all in the '28, '29. So there's no different, no change.”

“Yes, those are roughly the right numbers to forecast. Obviously, as we get out into the '27, '28 time frame, we're kind of hitting the normalized run rates of these SCIPs. So it will be higher than the $1.2 billion to $1.3 billion.”

“But clearly, we're going to -- our assets under construction will not be enough to support all our CapEx investments even with maintenance CapEx next year.”

“That said, we are going to want to continue to have optionality on fab white space. And that's while we are slowing down Ohio, we're not stopping Ohio. So we're going to continue to make investments, and there will be assets under construction or construction in progress on our balance sheet to make sure we have flexibility as the demand drivers change.”

“We think foundry gross margins will expand next year, and that will be a continuing story out for several years.”

“I think next year, the big benefit for us is this significant ramp in Panther Lake given that we're bringing a fair amount of wafers back inside, so that drives a lower cost, and we get the better cost structure of Panther Lake showing up with the higher volumes, that's clearly going to be beneficial to us in terms of gross margin.”

“NCI is still expected to grow meaningfully in fiscal year 2026.”

“We're forecasting 2025 OpEx of $17 billion with a 2026 OpEx target of $16 billion.”

“We will continue to work to reduce capital spending in 2026.”

“Obviously, the devil is in the details on this, but I think a good rule of thumb is that we get somewhere in the 40% to 60% fall-through next year, hopefully closer to the higher end of that if things work out in our favor.”

“But to kind of ballpark a number, I'd say probably half our CapEx, our normalized CapEx, call it, this $18 billion level for this year is probably what you consider sustaining or maintenance CapEx.”

“We will see at least double-digit or, excuse me, doubling of that revenue from 24 to 25.”

“We still see very strong commercial demand for AIPC.”

“While we have offsets including a global highly diversified manufacturing footprint to help mitigate tariffs, we will certainly see costs increase, and we feel it prudent to anticipate a TAM contraction.”

“In addition, we are mandating a four-day-per-week return to office policy effective Q3 2025.”

“We already have one large custom design win, and I would expect more.”

“But we don't expect to continue to see that into Q2.”

“As stated in last quarter's earnings, I talked about our main goal being to stabilize market segment share, create margin, and, you know, up ASPs, and so those are things that we're going to be laser-focused on for the remainder of the year.”

“Now, you know, obviously, as soon as we deconsolidate it, it won't be. So, you know, the target of the 60 will come down. You know, dollar for dollar for what Altera is spending in terms of OpEx.”

“But what we are anticipating and what's built into our guidance is that, you know, the macro is going to start to catch up to the implications of the tariffs. And so June is likely to be softer than our strong start to the quarter.”

“In '25, you know, we think we can operate to an $18 billion number as we talked about.”

“While gross CapEx is down, we maintain our range for 2025 net CapEx to be approximately $8 to $11 billion due to uncertainty regarding the timing of the US government fulfilling their obligations in our CHIPS agreement.”

“As Lip Bu stated, we anticipate our 2025 gross capital investment will now be approximately $18 billion, which is below our previous guide of $20 billion, reflecting further operational efficiencies, and better utilization of our construction in progress.”

“As a result, we now expect 2025 OpEx of $17 billion, $500 million lower than prior expectations with a 2026 OpEx target of $16 billion.”

“We expect non-controlled income or NCI to net to zero in Q2, and for the full year to be approximately $500 million on a GAAP basis.”

“We expect this deal to close in the second half of 2025, at which point we expect to deconsolidate Altera from our financial results.”

“While we continue to see the mix of AIPCs growing throughout the year, the rate of growth off a lower-than-expected Q1 will be lower.”

“We need to get our balance sheet healthy and start the process of deleveraging this year.”

“We have the first SKU by the end of this year, then we have additional SKU the next year.”

“I have directed our teams to find an additional $2 billion of savings in our gross CapEx, taking our target for this year to $18 billion.”

“We now expect OpEx of $17 billion this year and $16 billion next year.”

“So when you look at Nova Lake, we will build more wafers on Intel process than we are on Panther Lake.”

“When we look at 18A, our goal of bringing everything in-house, getting to a 70%, approximately 70% mix, remains steadfast, and there's no change to that POR, and Pantherlight helps us get on that journey.”

“You know, longer term, you know, this is a high-intensity model, obviously. You know, we've talked about roughly having 25% capital intensity as we look at this in a full IDM model. And I think that's probably a good working assumption on a long-term basis.”

“So we, you know, we'd expect next year to look better.”

“I think as you get into '26, things start to go the other direction, you know, Panther Lake will be ramping more in volume next year.”

“Ultimately, though, we do wanna see these AIPC products gain more traction in the market, and we're optimistic that happens in the year.”

“While we have yet to see a meaningful change in customer buying patterns, we think it prudent to manage the business with a level of conservatism going into the second half of the year.”

“So for Panther Lake, that was 18A. And as I said, we are very happy with where we are from a performance and yield perspective at this point in the process. So that will stay on 18A.”

“we remain on track to ship more than 100 million cumulative systems by the end of 2025.”

“It's definitely going to go up. Granite is on Intel3, Panther Lake is on -- Meteor Lake is on Intel3 or 4 – called the 4 three way node; panther Lake is on 18A this year. So we'll see a pretty meaningful jump in the percentage of wafers that will be EUV, as we exit '25.”

“That said, the Foundry business will see improvements. Over the course of the year, more wafers will be coming back.”

“We do expect some pretty significant offsets as well more than $10 billion of offsets, which will also help.”

“I'd say it is more about the same in '25. We're going to be acutely focused on cash flow from operations, really managing working capital effectively.”

“But we are going to stem the market segment share decline in client, and we're going to go after winning every socket.”

“De-levering in 2025 remains a top priority for us on lower CapEx, increased cash from operations and value unlock across our non-core assets.”

“We expect 2025 net CapEx of $8 billion to $11 billion with roughly half of the offsets expected to come from government incentives and tax credits and half from partner contributions.”

“We anticipate that our 2025 gross capital investments will be approximately $20 billion and at the low end of our previous guide of $20 billion to $23 billion, reflecting further capacity adjustments to Ohio and Ireland, as well as better utilization of what we call our construction-in-progress.”

“We expect non-controlled income, or NCI, to net to roughly zero in Q1 and be in a range $500 million to $700 million impact this year, on a GAAP basis.”

“Intel Foundry gross margin will improve on EUV mix shift and growth in advanced packaging despite expected depreciation growth in 2025 of roughly 10%.”

“Intel Products gross margin was 51% in 2024 and is expected to decline this year due to product mix in both CCG and DCAI.”

“At the consolidated level, we expect gross margin to improve from Q1.”

“For Q1, we expect Altera revenue to be down sequentially less than overall Intel consolidated.”

“we are going to leverage these strengths, as we work to stabilize our market share in 2025.”

“we will strengthen our client road map with the launch of Panther Lake, our lead product on Intel 18A in the second half of 2025.”

“I feel good about our ability to get to breakeven. Obviously, we want to have external customers.”

“Then as you look forward, to our next-generation product for client after that, Nova Lake will actually have die both inside and outside for that process.”

“So we are still aiming to get to breakeven in 2017, as you pointed out. It is really on the back of internal wafers or wafers from Intel products, I should say.”

“We are going to systematically attack our costs and remain highly focused on our goal of delivering break-even operating income for Intel Foundry by the end of 2027, and we expect to demonstrate improvements this year.”

“We are excited by the launch of Panther Lake this year and the internal ramp of Intel 18A in the second half that will support increased volumes and improved profitability in 2026.”

“2026 is even more exciting from a client perspective as Panther Lake achieved meaningful volumes, and we introduced our next-generation client family code named Nova Lake. Both will provide strong performance across the entire PC stack, with significantly better costs and margins for us, enhancing our competitive position and reinforcing our value proposition to our partners and customers.”

“There won't be a lot of lift in that business unit through the year. And it is really not until Panther Lake comes that they, I think, start to see some better cost structure and have a part that's very competitive that I think allows us to perhaps even relax some of that pressure in a competitive market.”

“The one dynamic in '25 is this kind of margin pressure around product like Lunar Lake. That probably pulls the range down to probably something more like in the 40% to 60% fall-through is probably the right way to think about it just for that dynamic.”

“I feel like we will probably outperform in that regard in terms of the mix of external customers versus internal customers.”

“Now we get into '26 and you start to see a lot more 18A volume through Panther Lake, I think we are in the 60%-plus range at that level.”

“I'd also emphasize that the Arizona ramp is important for us as we move to 18A. And that comes online in volume in the second half of next year and that's all on track as well as we have tool move-ins, EUV tools and qualification now, first wafers coming out of the volume fab in Arizona in Q1 of next year.”

“We remain on track to ship more than a 100 million AI PCs accumulative by the end of 2025.”

“First, we completed the vast majority of our headcount actions during Q3 and we are on track to our greater than 15% workforce reduction before the end of the year.”

“Most of the external revenue that we'll see, which will be nicely up year-on-year as we go into '25 in the external Foundry will be advanced packaging and we also see healthy margins for that technology as well.”

“Clearly, as you bring it to high-volume production, which we'll be doing in the second half of next year, we have to be markedly lower than that in terms of defect density.”

“You're right, yes, we do see more headwind in the second half versus the first half given Lunar Lake becoming a more meaningful part of the volume over time for 2025.”

“On the Foundry side, we will see improvement next year.”

“I think it's going to weigh down the gross margins on the product side of the business for us in '25.”

“So I think the 39.5% guide at the midpoint for the fourth quarter is a pretty clean guide.”

“Our expectation is for adjusted free cash flow to be negative in 2024 due to the restructuring charges disclosed today and the uncertainty around the timing of capital offsets as we approach year-end.”

“We anticipate that our 2024 gross and net capital investments will be approximately $25 billion and $11 billion respectively.”

“On a GAAP basis, as we continue to execute on our cost actions and portfolio decisions, we expect additional restructuring charges in Q4.”

“At the midpoint of $13.8 billion, we expect gross margin of approximately 39.5% with a tax rate of 13% and EPS of $0.12, all on a non-GAAP basis.”

“Based on these factors, we expect revenue of $13.3 million to $14.3 billion in the fourth quarter.”

“We anticipate inventory normalization will continue through the first half of next year.”

“For Q4, we expect high-single-digit sequential revenue growth, as we work with our distribution partners to prepare for the cutover to Altera independent warehouse operations.”

“Mobileye reported revenue of $485 million and maintained full year guidance for revenue and adjusted operating income.”

“Next year, as we move to nodes with a better cost structure and realize the savings associated with the restructuring actions, we expect operating losses to improve significantly.”

“We expect losses to continue at approximately the same rate in Q4, minus this impairment charge.”

“We expect the principal cash cost associated with the restructuring charges to land in Q4 2024.”

“Panther Lake will be our first client CPU on Intel 18A, a more performant and cost competitive process that will allow us to bring more wafers home and improve overall profitability.”

“All of this is paving the way toward the launch of Panther Lake in the second half of 2025.”

“That said, our outlook for Q4 is modestly above current consensus.”

“Yes. So overall the external Foundry business will be a modest portion, right, of the Foundry business for the next couple of years.”

“We said our financial objectives by the end of the decade are $15 billion plus of external Foundry revenue.”

“Again, that starts to improve in the following year as Panther Lake becomes more and more meaningful part of the volume for the client business in 2026.”

“It has much larger impacts on '26 financials as we ramp and bring wafers home as well as move into the better margin structure that we'll have on Panther Lake with 18A and across the product line.”

“We expect gross margin fall-through to significantly improve in 2026 driven by the vastly improved cost structure of Intel 18A, the return of tiles to a meaningfully underutilized Intel Foundry and operational efficiencies.”

“As our mix of outsourced products and CCG grows in calendar year 2025 and we ramp Intel 18A to support Panther Lake, gross margin expansion could be muted, particularly in the second half.”

“we believe our overall view of inventory levels, where our market share is, we're actually quite comfortable in the indications that we've given some inventory sell-through in the third quarter above seasonal in Q4.”

“We still believe that we're comfortably able to execute against those milestones across the projects that we've announced.”

“we remain on track to ship more than 40 million AI PCs by year end, and over 100 million accumulative by the end of 2025.”

“On Intel 18A, we released the 1.0 PDK last month and are on track to be manufacturing-ready by the end of this year with production wafer start volumes in first half of 2025.”

“we are accelerating actions to improve profitability and capital efficiency by more than $10 billion in 2025”

“Lunar Lake starts to become a drag on the Intel Products margins, which is why we're tempered in terms of our outlook for margins next year because we're going to have a lot of improvements on the Intel Foundry side.”

“As the Ireland factory ramps, a production factory will have a lower-cost per wafer start than a TV factory like Oregon. So it becomes a headwind as we go into next year.”

“Beyond that, it's going to start to become less and less to the point where it's actually not going to be a headwind.”

“That will carry into next quarter. I mean, we will do better in next quarter, obviously, but we're going to do more volume and the margins will be below the corporate average”

“we do see that overall the arm market share is more modest in the second half this year, so the X86 share, and we're stabilizing our overall position in the marketplace.”

“While that will obviously have a positive impact on gross margins, we still only expect a roughly 60% fall-through for gross margin next year.”

“We expect gross margins to be moderately weaker sequentially with modest revenue growth and efficiencies offset by a continued ramp of new manufacturing nodes.”

“We expect the IPU to be accretive to growth and profitability as it becomes an increasingly important part of acceleration in the AI data center.”

“we expect Gaudi 3 to deliver roughly 2 times performance per dollar in both inference and training versus H100.”

“Launching in Q3, Gaudi 3 will take our accelerator performance to the next level, at just two-thirds the cost of competitive offerings.”

“This will be followed by Xeon 6 with P-Core, codenamed Granite Rapids, which delivers greater performance for the most demanding workloads and will begin shipping this quarter.”

“Lunar Lake will quickly be joined by Arrow Lake, which will scale AI to the desktop category next quarter.”

“we will be collaborating closely with the ecosystem in the second half to prepare for next year's 18A launches.”

“we will also accelerate improvements by generating roughly $1 billion of savings in non-variable cost of sales in 2025.”

“As a result, we now expect gross CapEx in 2024 to be between $25 billion and $27 billion.”

“We are targeting a headcount reduction of greater than 15% by the end of 2025 with the majority of this action completed by the end of this year.”

“We believe the long-term guidance that we've given you, the 60:40, getting to the Foundry business model we've described, the growth areas that we've said, those are larger portions of our business.”

“So the $15 billion of LDV that we've talked about and the $15 billion revenue by the end of the decade, we're very confident that those are still very solid guidelines for us to be building to.”

“But as we said, 2026 is really this year that many of these wafers come home, many of the new factory investments come online, the new process technologies.”

“I think 2026 should be a good year for us in terms of gross margins.”

“We remain optimistic that reduced spending, operating efficiencies, and more competitive products will keep us on track to our target model of 60% gross margin and 40% operating margin by the end of the decade.”

“we will be in a great position to see meaningful gross margin expansion in subsequent years.”

“We continue to expect the investments we're driving through this year to put us on a course for meaningful financial traction with operating profits for Intel Foundry troughing in 2024 and then driving to breakeven.”

“But I'd say that 2027 timeframe is still a good one”

“So we feel very comfortable that the second half outlook is quite strong for the business, a first half a bit weaker, but we think it's very understandable, very explainable, and a second half outlook that will be very comfortable for every business across Intel growing and a lot of momentum as we go into '25.”

“That said, we see the peak of our external tiles being this year and next year. And then the road map and the movement of those coming back begins to quite accelerate, even starting late next year.”

“The operating losses will pick up. We roughly were at like 2-, 4-ish in the first quarter. It will pick up in the second quarter, given the start-up costs are increasing and I would say, be roughly in that range for the remainder of the year.”

“we expect that we're regaining share as we end this year and go into next year.”

“we'll see some areas which have high gross margins, helping us like, for example, Mobileye, we get good gross margin for Mobileye and the strength that we'll see through the year there and products like that will also help drive better gross margins in the back half of the year.”

“Overall, we're seeing a very healthy growth rate, mid-20s as we go through the year.”

“With significant capital offsets expected to land in the second half of the year, we continue to expect approximately neutral 2024 adjusted free cash flow.”

“Our net capital intensity forecast of mid-30s as a percent of revenue across 2023 and 2024 in aggregate remains unchanged.”

“We should also see accelerating growth from our network and edge businesses, a return to growth for Altera and a meaningful Gaudi ramp in the second half.”

“As we look beyond Q2 guidance, we expect growth across all segments in the second half of the year, led by improved demand for general purpose servers from both cloud and enterprise customers and increased core ultra assembly capacity to support a growing PC TAM, driven by enterprise refresh and the AI PC.”

“We see the client and data center business roughly flat to Q1 results at the low end of seasonal.”

“Mobileye reiterated full year guidance on their earnings call this morning. With the inventory digestion process on track, financial results are expected to recover quickly.”

“Beyond 2024, as volume begins to shift toward leadership manufacturing nodes with a competitive cost structure scale improves, including the return of compute tiles to internal process nodes and our efficiency actions begin to flow through the P&L, we expect to see rapid profitability improvement.”

“The foundry P&L will remain challenged through the year, and we expect operating margins to trough in 2024 as start-up costs associated with 5 nodes in 4 years peak and the P&L absorbs an expected increase of roughly $2 billion in depreciation.”

“which we expect to continue to recover through the year.”

“we expect to deliver full year revenue and EPS growth in 2024, with the pace of revenue growth accelerating in the second half.”

“Lastly, within NEX, the business has stabilized and beat our Q1 targets with channel inventories approaching normal levels and business acceleration expected through the year as a result.”

“customer conversations continue to show improving signs for traditional CPU refresh starting in late Q2 and into the second half.”

“We continue to expect share trends to stabilize this year before improving in 2025.”

“Improving second half Meteor Lake supply, and the addition of Lunar Lake and Arrow Lake later this year, will allow us to ship in excess of our original 40 million AI PC CPU target in 2024.”

“We expect to release the 1.0 PDK for Intel 18A this quarter.”

“Intel 20A, which helps pave the way for Intel 18A, begins production ramp in the second half of this year with Arrow Lake.”

“We continue to see Q1 as the bottom, and we expect sequential revenue growth to strengthen throughout the year and into 2025”

“And then what I said before is we see that improving then going into '25. And Pat's given me the order, he wants to see every quarter some improvement in the operating loss ultimately to get to breakeven midway through the point between now and 2030 and I think that is very achievable.”

“Given this backdrop, we have clear line of sight to becoming the largest system foundry for the AI era and the second largest overall by 2030, building on our EUV High-NA process technology leadership in advanced packaging, manufacturing capacity, our systems expertise and the surge in AI demand.”

“So the plan is clearly laid out. As we said, we see a couple of fabs' worth of capacity coming back into the Intel factory network as we move into '26 and beyond.”

“we're driving to get to kind of mid-50s gross margins by the midpoint between now and 2030 and ultimately getting to 60%.”

“And we really do think that the 60-40 is what Dave and I are driving the business to and we're going to get there.”

“I expect the bulk of the market to stay on Granite Rapids type products, the P-core products, certainly in '24 and '25.”

“I think we'll get, like I said in a call a couple of quarters ago, $4 billion to $5 billion of savings from this internal foundry model ultimately.”

“We do expect year-on-year growth here. We see our market share stabilizing.”

“We expect depreciation to grow by approximately $2 billion in 2024, in addition to a significant increase in variable factory start-up costs.”

“We expect Q1 data center revenue to decline double-digit percent sequentially before improving through the year.”

“Additionally, we expect a significant drop in IFS revenue after seeing accelerated purchasing in our traditional packaging business and cyclical weakness in wafer equipment buying in the first half of the year, impacting the IMS business.”

“While our continued IDM 2.0 capital investments will result in increased gross CapEx in '24 as compared to '23, we're on track to our aggregate 2023 through 2024 guidance of net CapEx spending in the mid-30s as a percent of revenue, with offsets towards the high end of the 20% to 30% range.”

“We see incremental efficiencies as we drive to our long-term model of 60% gross and 40% operating margins.”

“In 2025 with Panther Lake, we will grow AI performance up to an additional 2x.”

“The Core Ultra platform delivers leadership AI performance today with our next-generation platforms launching later this year, Lunar Lake and Arrow Lake tripling our AI performance.”

“We recently increased our supply for both Gaudi 2 and Gaudi 3 to support the growing customer demand and we expect meaningful revenue acceleration throughout the year.”

“We're building on this momentum with Gaudi 3, which is on track to launch this year and is expected to deliver performance leadership with 4x the processing power and double the networking bandwidth for greater scale out performance.”

“Intel 18A is expected to achieve manufacturing readiness in second half '24, completing our five nodes in four year journey and bringing us back to process leadership.”

“Within NEX, telco markets are likely to remain weak through the year, though we expect solid growth from our Network, FNIC and Edge products.”

“Our views and forecasts of our client business is very healthy for the fourth quarter.”

“We feel very confident that we are on track to the leadership position that we described.”

“We remain on track to reducing costs by $3 billion in 2023, and we continue to see significant incremental opportunities for operational improvement as we execute on our internal foundry model.”

“we are on track to surpass 2 million units next month.”

“we feel pretty comfortable that we're in a cycle that there will be growth in CPUs led by Xeon, as well as accelerators.”

“That does improve a bit in the fourth quarter. But we'll be kind of dealing with this underload hangover, I'd call it, probably all through next year as we kind of progress”

“We do believe that we'll have plenty of opportunity in China continuing to deploy our products there broadly even as we comply and work with BIS specifically around the regulations that they're putting in place, particularly around high-end accelerators and AI training.”

“We'll have -- we expect in the next two years over 100 million x86 million AI-enhanced PCs in the marketplace.”

“I'd say fourth quarter, we start to go back to what would be more of our typical fall-through range, somewhat muted by the fact that we are still going through 5 nodes in 4 years... it's probably like a 60% fall-through.”

“We expect PSG to decline in Q4 and be depressed for the next few quarters as customers work through inventory before returning to a more normalized run rate and growth.”

“we expect sequentially higher OpEx in Q4 due to seasonal marketing activities, higher profit-dependent compensation and the end of some temporary austerity measures taken earlier in the year.”

“Capital offsets will trend towards the higher end of our 20% to 30% range in that time frame, though we do expect the vast majority of those offsets to land in 2024.”

“There are no changes to our prior forecast of mid-30s percent net capital intensity across 2023 and 2024 in aggregate.”

“At the revenue midpoint of $15.1 billion, we expect gross margin to flow through at approximately 60% of revenue growth, resulting in Q4 gross margin of approximately 46.5% with a tax rate of 13% and EPS of $0.44.”

“We expect moderate sequential growth from DCAI, with Xeon's strength more than offsetting a decline in PSG and continued recovery in edge markets roughly offsetting persistent network weakness.”

“We expect fourth quarter revenue of $14.6 billion to $15.6 billion, delivering on our January commitment to grow revenue sequentially throughout 2023.”

“We see continued signs of stabilization heading into Q4.”

“Our ethnic and IPU businesses are well suited to support the high I/O bandwidth required by AI workloads in the data center with growth expected to accelerate for both in 2024.”

“In the near-term, we expect Windows 10 end-of-service to be a tailwind, and we remain positive on the long-term outlook for PC TAM returning to plus or minus 300 million units.”

“We expect full-year 2023 PC consumption to be in line with our Q1 expectations of approximately 270 million units.”

“As we expected, customers completed their inventory burn in the first-half of the year, driving solid sequential growth, which we expect will continue into Q4.”

“In addition, we expect to capture a growing portion of the accelerator market in 2024 with our suite of AI accelerators led by Gaudi, which is setting leadership benchmark results with third parties like MLCommons and Hugging Face.”

“Across most customers, we expect to exit the year at healthy inventory levels, and we see growth in compute cores returning to more normal historical rates off the depressed 2023.”

“and our road map provides significant further improvements with Granite Rapids expected to deliver an additional 2 times to 3 times AI performance on top of our industry-leading 4th Gen Xeon.”

“During the quarter, we were awarded two customer AI designs for our advanced packaging and with an additional six customers in active negotiations, we expect several more awards by year-end.”

“We have also made substantial progress with our next major customer and are expecting to conclude commercial contract negotiations before year-end.”

“We also announced our plans to begin installation of the world's first high NA EUV tool for commercial use by the end of the year to continue our modernizations and infrastructure expansions of our Gordon Moore Park in Oregon, home of our technology development team.”

“We expect to achieve manufacturing readiness for Intel 18A in second-half 24, completing our incredible five nodes and four years journey on or ahead of schedule.”

“I just think that we will see a lot of opportunities as we progress through '24 and beyond that are really going to make an impact on gross margins and give us a lot of confidence around this 60%.”

“I feel like we are even more confident around our ability to hit that 60% threshold for a number of reasons.”

“We plan to report PSG results as a stand-alone segment in Q1, to bring in private investors in 2024 and to create a path to an initial public offering over the next two to three years.”

“this business longer term should have margins that are very similar to margins you see from its peers when they are operating at healthy levels of margins.”

“Our expectation is still by the end of the year to get to breakeven free cash flow. There’s no reason why we shouldn’t achieve that.”

“We continue to see solid demand signals for the client business from our OEMs and even some of the end-of-quarter and early quarter sell through are clear indicators of good strength in that business.”

“And both of those numbers, like I said, will be lower in the third quarter.”

“As it relates to pre-PRQ reserves in the fourth quarter, we’re likely to have some, but it should be a pretty good quarter-over-quarter improvement from the third quarter, which was obviously a good quarter-over-quarter improvement from the second quarter.”