After years of decline, Intel (INTC) appears to be on track for a dramatic comeback. Under the leadership of Lip-Bu Tan, investors are becoming increasingly confident that Intel can remain a player in the semiconductor industry.
Intel's decline accelerated in the early part of the last decade as innovation slowed after the founders' retirement and passing. That opened opportunities for Advanced Micro Devices to gain a technical lead and for Taiwan Semiconductor Manufacturing to surpass Intel in manufacturing. Nvidia's AI accelerators also pushed Intel further behind even as former CEO Pat Gelsinger pursued a strategy to become a leader in CPUs and in manufacturing.
Tan, the CEO who transformed Cadence Design Systems, appears poised to make Intel more competitive. Intel has advanced the 18A manufacturing process, which can produce chips as small as 1.8 nanometers, enabling next-generation AI processors. This shift supports a plan to compete with TSMC on manufacturing capabilities and to reclaim ground in CPU performance, reinforcing the idea that the United States can stay relevant in chip production.
With Tan revamping Intel's business, the development of AI chips and a stronger manufacturing capability could support accelerated revenue growth if Grand View's projected CAGR for AI chips holds. The 18A process technology is cited as a tangible indicator that Intel can better compete with AMD in CPUs and with TSMC in manufacturing.
Is Intel a long-term buy right now? The Motley Fool Stock Advisor team recently identified what they believe are the 10 best stocks for investors to buy now, and Intel was not among them.
