```
2020 + $21.411B
2021 + $9.127B <— Pat takes over
2022 - $9.411B
2023 - $14.279B
2024 - $15.656B
```
Just the facts.
Now watch the downvotes on factual, irrefutable data.
8 replies (most recent on top)
big empty fabs
Fab expansion and chasing the leading is not economic for Intel.
This has been obvious for over a decade now.
PC volumes have been flat for over a decade.
Fixed costs on leading edge nodes have been going up in a very non-linear way.
You can’t reconcile those two facts.
Meanwhile, the competition (TSMC) can afford to push the leading edge due to a huge diverse customer base. You can’t expect to leapfrog them when you are at such a huge scale disadvantage. It’s su----e.
Another missed fact was that the fabless competition also has access to better and more cost-effective transistors.
Intel needs to cut their losses and give up the leading edge fab investments. They were never going to make it there.
I am one of the few who still believes the "fix and expand the fabs" strategy was sound.
Parts of the rollout and execution was unsound.
"Five Nodes in Four Years" was a problem. PG made that his mantra and it was doomed from the outset. It required capital, execution, etc. not seen at Intel in some time - if ever. That would have been a fine goal, but it really should have been accompanied by a different mantra. That way, there was a path to success that did not require super-perfect execution. 5/4 was a "marching order" to some and it was clearly impossible very soon after.
Funding expansion with debt is sound if (1) debt is cheap (2) underlying businesses are flat or expanding and (3) there is ample other FCF to run the rest of the business. I believe that Intel incurred more debt b/c it was relying too heavily on US CHIPs, local CHIPs, etc.
Last, it was not clear that the market could support the capacity that was being built. A more tempered approach should have been applied. PG admitted he bet the company on 18A, which seems true. Perhaps he could have bet less of the company.
Bain Capital did cook the books really well.
The data the OP shared is only part of the Pat puzzle..
More data can be provided to show how nightmarish the tenor of the revered pastor really was..
Also look at all his horrible ELT hires and refugees which leeched in from VMWare and other places.
He deserved to be fired
Id--t
yeah increasing fcf with debt what a strategy