Intel breaks out foundry finances

The company has applied the new financial model for its foundry business  to previous years’ results and says that last year the foundry operation had revenues of $18.9 billion for a loss of $7 billion down from 2022 revenues of $27.5 billion when the loss was $5.2 billion.

CEO Pat Gelsinger said that 2024 will see the peak of the foundry business’ losses and that it should be profitable around 2027.

CFO Dave Zinsner, said, “This model is designed to unlock significant cost savings, operational efficiencies and asset value. As it begins to take hold, we expect to accelerate on our path toward achieving our ambition of 60% non-GAAP gross margins and 40% non-GAAP operating margins in 2030. Ultimately, improved cost competitiveness will help us deliver process technology, product and foundry leadership while driving significant financial upside for Intel and our owners.”

“Intel’s differentiated position as both a world-class semiconductor manufacturer and a fabless technology leader creates significant opportunities to drive long-term sustainable growth across these two complementary businesses,” said Gelsinger,  “implementing this new model marks a key achievement in our IDM 2.0 transformation as we hone our execution engine, stand up the industry’s first and only systems foundry with geographically diverse leading-edge manufacturing capacity, and advance our mission to bring AI Everywhere.”

Gelsinger blamed Intel’s slippage in the process technology race to it being late to adopt EUV. “In the post EUV era, we see that we’re very competitive now on price, performance back to leadership,” said Gelsinger, “and in the pre-EUV era we carried a lot of costs and uncompetitive.”