I swear HN's discussions on anything Intel related are always bottom of the barrel. They've been very clear about their messaging over the past few years. They are currently spending large amounts of money on capital expenditures to ensure future competitiveness and that eats into profits. The lack of increased profits during this current chip shortage is not a surprise to anyone paying attention nor is it indicative of anything particularly catastrophic for Intel.

From Reuters

>Intel Corp expects its profit margin to drop this year and then be steady for several years as it invests in new technologies and factories to meet rising chip demand, but added it forecasts climbs from 2025.

It is amazing how much incorrect analysis this global chip shortage has brought about. The situation with intel is complex but I will bring out the simplest error in this analysis.

Chips are not like oil, or steel or wheat. A chip shortage is a very different beast than an oil or wheat or iron ore or copper shortage.

Lets say that there are 500 different chips in a device. This is not an exaggeration. If you are short of chip #203 you cannot throw an extra couple of pieces of chip #205 instead. These chips are different and the exact ones are needed. Furthermore, many of these chips are made using different processes in different fabs, so you cannot slow down manufacture of chip #205 to make some extra ones of chip #203.

So that is the first thing to keep in mind in terms of the chip shortage. Currently the chips that are in shortage are mostly things intel does not make. To the best of my knowledge chips in shortage are power electronics, power discrete, power management ics, networking ics and industrial/auto/medical grade microcontrollers. If someone had updates to this list, please comment below.

The thing about the chip shortage is, that if there is a shortage in something you do not make, it is not necessarily a good thing. That may mean that your client will make fewer devices because they do not have that chip #203, and you will be able to sell them fewer of your chip #205.

Of course intel has some very serious issues but this chip shortage argument is just wrong.

These analyses always focus on M&A, outsourcing, and that kind of business stuff while completely ignoring the decades of disgruntled engineers that left Intel to its present fate. Intel engineering was mismanaged for years and now they are paying the price.

Intel got MBA'ed just like most American companies. Will be interesting if/when it will happen to Apple.

Isn't this because Intel under-invested in R&D over the last several years and Gelsinger is (rightly, it seems) saying he needs to invest a bunch of money to catch up?

I was bullish on Intel all of last year but I think it’s effectively dead money until 2024-25. Between AMD and Apple, Intel is so far behind. Their GPU launch is also an indication that they are very disorganized.

Top three reply chains are transparently Intel damage control. It slides the topic but doesn't add anything to the discussion. Fact is Intel flopped on the tick tock cycle and is going the TSMC route to try to move to a smaller process and this is essentially what's been going on with them in the past few years. Moreover we learned through Spectre and Meltdown that Intel took a lot of shortcuts for decades, Theo De Raadt famously called out the CORE microarchitecture as being dramatically flawed and he ended up being correct[1].

Profits are important as a publicly held company but Intel needs a new from-scratch improved microarchitecture which isn't based on the venerable Pentium Pro, which is basically what we're all running a riced up version of even today.

[1]https://linuxreviews.org/Theo_de_Raadt_on_the_Intel_Core_2_J...

The big question in semiconductors is what will happen to the China-Taiwan situation. China has repeatedly stated that they intend to reunify with Taiwan by 2049 for the 100th anniversary of their communist party. I think they will probably try. If there's fighting then there's a good chance that TSMC ends up destroyed. Refugees can flee, physical plants can be destroyed.

So if TSMC is destroyed, what happens to everyone downstream who depends on semiconductors? We probably end up both delaying products for years and giving Intel boatloads of money thinking "I sure hope they can scale up their only-three-years-behind technology quickly."

So we should subsidize Intel to keep improving their currently-uncompetitive technology. This isn't the same as most "we should make things in America" complaints, it's a contingency plan for a specific, reasonably likely intense disruption to the world of technology.

Haven't checked Intel's stock in quite some time. I am familiar with their RISC-V moves and big future plays.

Market Cap 180 billion sounds great.

PE ratio of 7.3...

WOW. People are heavily predicting major crash on intel. Very nice dividend as well... so they aren't attracting people?

15 billion/year into R&D is pretty comfy.

Gain on Sale of Security 6,823million

Good and increasing EPS, consistently beating estimates.

total assets are going up very well.

total debt is going up and is a bit high.

Their financials look good. I dont see why their PE ratio would be sooooooo low.

0.06% % of Shares Held by All Insider

Oh. Intel is probably just skittering by, and it's really the everything bubble that's the problem? Might make sense.

I think the bigger reality? They label their assets as 168 billion and their market cap is 180 billion? Can we talk about bankruptcy?

Question: why is it that Intel can’t just poach a bunch of the best TSMC engineers and catch up that way?

Is it a lack of knowledge how to do this manufacturing? Or is it more like a skills shortage of engineers to do the actual manufacturing?

Where exactly is it in the process that they can’t compete, and why is it so hard to catch up, given their virtually infinite R&D budget.

This is stategic. Making money out of it is optional (like defence).

They should ask Nvidia how they did it, or they could peek, they got the data after all

Intel is done. Gelsinger can do his best to rally the troops but it's too late to catch up with Apple Silicon. The M1 came out in 2020 and Intel is still unable to match it. The M2 is coming this year, leaving Intel ever further behind.