It only makes chips for Intel, right?
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How is 2024 a peak? What’s going to be different in 2025?
The $7B loss was for 2023. We're going to lose even more money this year.
"The foundry business had a $7 billion operating loss last year, translating to a negative 37% operating margin. Intel (INTC) expects losses for the segment to peak this year. "
https://www.morningstar.com/news/marketwatch/20240405343/intels-stock-is-having-its-worst-week-since-2020-is-the-selloff-justified
An EUV scanner is about $300 million each incl install, supplier contract etc. do the maths 10 of these will cost 3 billion, don’t forget all the other tools
The short answer... gross TMG inefficiencies that were hidden by decades of mis-information, mis-management, and lies by Intel Finance.
$7B operating loss
https://www.reuters.com/technology/intel-discloses-financials-foundry-business-2024-04-02/
It is because me and my coworkers who are part of IFS and not working since last 6 months. Our team moved to IFS as part of CPM and we don't have work since last 6 months. Management has no idea what work to assign.
In foundry- two key metrics : Utilization and Yield. In intel the utilization is very low (TSMC is operating at 80%) and around 60% yield. intel is half of what TSMC does. Then go fugure
Yet the US Gubment is handing billions of TAX PAYER dollar$ over to Intel in the interest of national security.
We're so sc--wed.
because we outsourced 30% to external fabs, instead of eating our own dog food. Then again, we'd have no actual products without TSMC.
https://www.tomshardware.com/tech-industry/intel-foundry-unit-loses-dollar7-billion-in-2023-company-outsources-30-of-its-production-to-tsmc-others
More than five years ago, AMD dumped its Global foundry to save its faith from bankruptcy and rising from a $3 stock worth company to $200 stock worth company. Today, more than five years later, Intel just make a smart move to start its Intel foundry to go back into bankruptcy because it doesn’t like AMD.
A lot of bloat
Intel manufacturing has grown to be expensive relative to peers. There's no mystery to it... just the first time we are all seeing the number.