Intel shares jump as investments, cost cuts catapult turnaround efforts
Intel shares saw a significant surge of up to 7.8% in early trading on Friday, reaching an 18-month high. This increase in stock value came as investors showed support for CEO Lip-Bu Tan’s aggressive cost-cutting measures, which helped the chipmaker exceed quarterly profit expectations and regain stability amidst a competitive landscape and manufacturing challenges.
The latest financial results indicate a turning point for Intel, a company that has faced difficulties in maintaining its position in the market. Following a challenging 2024 that resulted in its first annual loss in nearly four decades, Intel is now focusing on strategic investments and operational discipline to rebuild investor trust.
One of the key factors contributing to Intel’s recent success is the support it received from major investments by companies like Nvidia and Japan’s SoftBank, as well as a stake from the U.S. government. These financial injections have provided Intel with a cushion as it works towards revitalizing its growth.
CEO Tan’s efforts to turn the company around have been instrumental in boosting investor confidence. As a result, Intel’s stock has rebounded by more than 90% in 2025, outperforming competitors like Nvidia and AMD. With a 12-month forward price-to-earnings ratio of 71.51, Intel is positioned for further growth in the coming year.
Despite these positive developments, Intel acknowledges that its turnaround is far from over. Demand for its chips is surpassing supply, especially in data centers where operators are upgrading CPUs to support AI workloads. However, challenges remain with the company’s advanced 18A manufacturing process, as yields are expected to remain below industry standards until 2027.
CEO Tan has made significant strategic changes, including selling a majority stake in Altera and shifting Intel’s capital strategy to rely more on external investments. He has also streamlined the company’s manufacturing ambitions and reduced its workforce by over 20%.
While some industry analysts believe that Intel is on the right path towards recovery, others caution that the battle is far from over. It may be premature to claim victory just yet, as challenges still lie ahead for the company.
In conclusion, Intel’s recent performance reflects a positive trajectory, but the company must continue to navigate through ongoing challenges in order to sustain its growth. With strong leadership and strategic investments, Intel is poised for a promising future in the tech industry.
(Reporting by Rashika Singh and Arsheeya Bajwa in Bengaluru; additional reporting by Alun John in London; Editing by Joice Alves and Saumyadeb Chakrabarty)
