Intel follows easy fixes with the hard ones

Intel said on August 10 that it was planning to raise **$15 billion** through a share sale. The chipmaker’s stock opened **3.3% lower** in morning trading following the announcement. The company expects to grant underwriters an option to buy up to **$2.25 billion** of additional shares of common stock. Chief Financial Officer David Zinsner told Reuters in July that the company had raised its capital expenditure forecast for 2026 from **$18 billion** to **$20 billion**, with spending expected to be “up meaningfully next year” as well. Current CEO Lip-Bu Tan followed up with more cuts and the sale of a majority stake in subsidiary Altera for **$4.5 billion**. All of this, however, was just a stopgap. The actual measure of success would be returning to growth that could support sustainable investment in keeping up with TSMC. On that front, Intel now looks to be making progress. The AI boom previously focused on the likes of Nvidia’s graphics processors. The recent rise of autonomous agents, though, necessitates coordination work best served by Intel’s longtime stronghold of traditional processors for servers. As a result, the pace of growth for this market is set to double, according to arch-rival AMD **AMD.O**. Over the past year, Wall Street analysts have drastically increased their expectations for Intel's Data Center and AI business, with estimates for third-quarter revenue rising from **$4.1 billion** to **$6.6 billion**, according to Visible Alpha. Intel **INTC.O** is moving on to the hard part of its revival. After cutting costs and selling assets to stabilize the business, CEO Lip-Bu Tan on Monday unveiled a **$15 billion equity raise** to further rebuild the chipmaker’s manufacturing ambitions. It’s a smart move to capitalize on what looks like a breakthrough in catching the artificial intelligence boom. Trapped for years in a vicious spiral of declining market share, rising investment needs and fading technological superiority, Intel’s turnaround began with the most obvious, rushed fixes. Former boss Pat Gelsinger pushed through hefty job cuts and scrapped the company’s dividend as he sought to build immensely expensive new chip fabrication facilities, with hopes of becoming a contract manufacturer that could challenge ascendant rival Taiwan Semiconductor Manufacturing **2330.TW**. Rapidly declining profitability left little financial room for maneuver, though, so Gelsinger agreed to two major deals, with private-capital giants Brookfield Asset Management and Apollo Global Management **APO.N**, to sell stakes in projects for new production facilities. The consequent fourfold increase in the company's stock price means it can now issue shares to raise money at a reasonable cost. Some clever financial engineering helps: in April, Tan agreed to buy back Apollo’s stake in an Irish chip facility joint venture. Thanks to the intricacies of accounting, that deal should flatter earnings per share, offsetting dilution from new issuance. Intel is finally acting from a position of strength, rather than applying short-term Band-Aids.

Intel follows easy fixes with the hard ones

Context from Intel's capital plans

Cost cuts and asset sales were only a stopgap

Intel moves to the harder part of its turnaround

The stronger stock gives Intel room to raise capital

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