Useless as a mudslide trying to support a wall, Intel?

Today, let's continue talking about Intel in the U.S. stock market. Recently, its stock performance has been quite good, rising from about $20 in mid-2025 to now $120, roughly a sixfold increase.

However, in fact, from its high of $65 in 2021 until 2025, Intel performed very poorly. While the "Seven Sisters" (the big tech giants) were soaring wildly between 2021 and 2025, Intel lagged behind. But recently, it has started to rise again. Why is that?

When we discussed TSMC earlier, we mentioned advanced process technology, which is currently the most advanced in the world. Intel has already fallen significantly behind in this area. Intel's 2nm-level process has been chasing for 10 years without catching up.

Furthermore, Intel is mainly focused on CPU manufacturing. When people buy computers, they often see labels like Intel Core i5 or i7. Intel used to be the absolute king in the CPU space. Currently, the PC industry itself has basically peaked, with limited growth potential. Plus, AMD has been eroding its market share; for example, AMD's Epyc series offers lower power consumption and higher computing power in many scenarios. So, the CPU business has been growing only modestly.

In the AI era, Intel made a wrong bet on the direction, which is its most fatal mistake!

Intel believes that CPUs are still the core of the AI era, but Jensen Huang of NVIDIA says GPUs are the future. As a result, NVIDIA has become the company with the highest market value today.

Next, let's look at the financial data:

Market cap is 600 billion dollars. Since 2021, annual revenue and net profit have been continuously declining. In 2021, revenue was 79 billion dollars, but by 2025, it had fallen to 52 billion dollars.

Net profit has also been declining steadily. In 2021, net income was 19.8 billion dollars, but by 2023, it was only 1.9 billion dollars, and in 2024, a loss of 18.7B dollars. (This loss mainly resulted from a one-time large non-cash accounting write-off and restructuring costs in Q3, mainly due to depreciation of outdated equipment, a division asset restructuring, and investments in factory construction.)

Over the past 4-5 years, Intel has been undergoing a transformation. In 2021, its CEO stated, "Re-establish as a world-class manufacturing company," aiming to develop its own wafer foundry, not only designing chips but also manufacturing them.

Currently, advanced process technology is all abroad, such as TSMC and Samsung, while the U.S. has no domestic advanced manufacturing. As early as 2022, the U.S. signed the CHIPS Act to support domestic chip manufacturing.

Additionally, the current U.S. government strongly supports this, as Trump promoted bringing manufacturing back to the U.S. when he took office—"Make America Great Again!"

Therefore, in the semiconductor field, Intel is the only player. It is not only a commercial company but also bears the important role of "America’s strategic semiconductor asset"—rebuilding the U.S. advanced manufacturing industry!

Intel has also received substantial subsidies. So, although its financial data looks terrible now, it is backed by the U.S. government as a national team. The government won't let it fail. If a company is supported by the entire country, no matter how bad it is, it won't completely collapse (short-term, the stock price has indeed been boosted).

From the financial data, Intel's foundry business is actually growing. In 2024-2025, it generated 17 billion dollars in revenue. Although many of these orders are reportedly allocated by the U.S. government, who cares? It’s "government-supported"!

Risks:

1. The biggest risk now is whether Intel can catch up with TSMC's advanced process technology. Although they are loudly claiming to do so, the results are mediocre. The market has been repeatedly told "wolf is coming," leading to a decline in trust.

2. Can its own foundry secure enough clients? Currently, most are forced by the government. If its technology cannot keep up in the future, it will still be problematic. Building a strong foundation requires real strength.

3. If GPU demand in the AI era explodes in the future, CPUs could be completely marginalized!

In summary, although Intel is currently a company strongly promoted and protected by the U.S. government, most of its prospects seem like "flowers in a greenhouse." I find this very worrying. For example, Huawei in China was restricted, but the government didn't intervene much, and Huawei still survived. So, a company must adapt to the environment itself, not just rely on protection, which is useless in the long run. Currently, Intel's market cap is 600 billion dollars, but I believe it will never reach 1 trillion. It’s highly likely to be a sinking ship that cannot be saved. If support doesn’t show results in 2-3 years, the support will probably be withdrawn.