Is Intel For Sale?

Intel has been a Fortune 500 company for as long as I've been alive consistently controlled well over 80% of the PC CPU market for most of the 2010s and hit a 20year stock price High only about 3 years ago but this month the company lost its spot on the Dow Jones Industrial Average and headlines say they may potentially be bought by another company but how bad could things really be for team blue did those Shenanigans with their 13th and 14th gen chips being unstable really have that huge of an impact on the company to be clear as well publicized as those instability issues were within the gaming PC Community they didn't hurt Intel very much financially the affected chips represented a relatively small number of higher-end models for a company that sells mostly mid-range chips to computer manufacturers like the Dells and Lenovo of the world no to understand how Intel sank into this position we have to go all the way back to 2015 when Intel's struggle with making chips on the 10 nanometer process started hitting the tech news hitting 10 nanometers would have meant more powerful and more energy efficient chips which is something Intel obviously needed eventually but at that point they weren't investing in expensive euv manufacturing technology which makes it easier to create chips with smaller transistors the powers that be at Intel already took a generally conservative approach with any significant changes to their manufacturing processes but another big part of the reason the euv investment didn't happen is because team blue just didn't have pressure from competitors back then AMD was still struggling with its anemic bulldozer family of CPUs and apple was still buying processors from Intel to using its Max but not long after 2015 the landscape really started to shift amd's New Zen architecture hit the scene in 2017 and was an almost immediate hit in that same year tsmc a massive contract manufacturer that now makes ryen ch started using euv to make products with smaller transistors then Apple broke up with Intel in 2020 in order to use its own Apple silicon processors in its Max all these developments meant that intel was suddenly significantly behind its competitors in terms of their ability to crank out Leading Edge chips team blue finally got its act together somewhat in 2021 when they brought back former executive Pat Ginger to be their new CEO ginger wanted to embrace EU V following infighting among Intel board members over how to modernize its chip strategy Intel started releasing chips on what they called their Intel 7 process which was really a fixed 10 nanometer process that same year and started mass producing chips using euv in 2023 but the factors leading to Intel's struggles go beyond merely being behind their competitors in terms of manufacturing we'll tell you about an arguably even bigger problem and the potential consequences right after we thank our sponsor MSI their MPG 341 cqx QD OLED monitor delivers stunning image quality with an ultra fast 0. 03 millisecond gray to gray response time and a 240 HZ refresh rate for smooth gameplay this monitor doesn't just stop its speed it's got QD premium color ensuring market Standard color accuracy plus Vasa display HDR true black 400 for stunning HDR visuals and with the gaming intelligence app you can fine-tune the perfect settings for any game check out the MSI MPG 341 cqx QD OLED monitor using our Link in the description unlike competitors like AMD and apple Intel owns its own Fabs for manufacturing its chips and these Fabs are very expensive to build run and maintain in order to be profitable they need to be running at close to full capacity however during this Intel struggle period we mentioned some of their Fabs were only running at around 70% therefore intel was still pouring about the same amount of money into these Fabs that they would have been had they been running at full capacity but far fewer chips were coming out of them to sell so does this mean that Intel is losing so much money from keeping its Fabs open that the company will be sold off to the highest bidder well not quite the situation Isn't So dire that Intel is on the verge of bankruptcy and team blue does have a plan to get their Fabs running at full capacity one big piece of this is that Intel is going to perform contract manufacturing for other chip designers at its Fabs historically this wasn't possible because Intel's factories used proprietary chip design software that no one outside of Intel really knew how to use however Intel is moving to Industry standard tools for both its existing Fabs and the new Fabs it's currently building which are on track to start producing chips in 2027 Intel May then try to get outside investors to own a part of its Fab business and operate it like a

subsidiary but the company would have to be in very Dire Straits for a total spin-off to happen like what AMD did back in 2009 with their Fabs amd's former Fab business is now a separate company called Global foundaries indeed it's more likely that Intel would sell off parts of the business rather than the whole enchilada this is already happening in part as Asus has taken over Intel's nuck business Apple got Intel's smartphone modem technology and Intel is currently trying to sell a minority stake in Altera which is a line of fpga another Intel Department that might be ripe for the taking is their data center AI business which is lagging far behind Nvidia and AMD since intel was late to the party and outside of Intel's plans to write itself there just aren't a lot of companies that would have the desire and ability to buy all of Intel outright Apple who has been mentioned as a potential buyer in the Press has already committed to the arm architecture rather than in Intel's x86 and they already have a good relationship with tsmc who manufactures Apple silicon meanwhile Samsung's name has also been thrown around but they're having issues of their own with manufacturing and would probably face regulatory hurdles as a foreign company trying to buy a us-based business that the American government views as critical to its economy hence its recent funding of Intel through the chips act so I wouldn't expect Intel to become a subsidiary of some other tech company but who knows maybe one day the Walton family will get bored and suddenly will have great value brand CPUs on the shelves at Walmart hey thanks for watching if you like this video check out our other video on why Intel and AMD are the only two companies making x86 CPUs