Jim Cramer Calls Out Intel’s $18.8 Billion Foundry Loss Regardless of Subsidies: ‘We Promote Your Inventory’
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Jim Cramer, the host of CNBC’s “Mad Cash,” spotlighted Intel Company’s (NASDAQ:INTC) staggering $18.8 billion loss in its foundry division in 2024, regardless of receiving $8.5 billion in U.S. CHIPS Act subsidies.
Cramer took to X on Wednesday to spotlight the monetary challenges of home semiconductor manufacturing within the face of world competitors. He questioned whether or not producing chips within the U.S. is sustainable, citing Intel’s substantial losses regardless of receiving authorities subsidies.
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“You need to construct semis right here? We promote your inventory,” he acknowledged.
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Intel’s monetary woes have been a subject of concern amid its bold 18A chip venture. This venture, which is essential for regaining its technological edge, has reportedly encountered yield points, threatening its capacity to profitably produce superior chips.
The 18A course of, developed over a number of years and backed by multibillion-dollar manufacturing facility investments, underpins Intel’s plan to grow to be a top-tier foundry rivaling Taiwan Semiconductor Manufacturing Co. (NYSE:TSM). Nevertheless, solely a small fraction of 18A-produced Panther Lake chips have met high quality requirements, elevating issues over Intel’s readiness to ship high-end parts at scale.
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Intel’s monetary struggles have been additional compounded by intense competitors from rivals like Superior Micro Gadgets (NASDAQ:AMD) and Qualcomm Inc. (NASDAQ:QCOM).
Fitch Rankings downgraded Intel’s long-term credit standing from BBB+ to BBB, citing the corporate’s ongoing battle to keep up demand for its semiconductor merchandise.
Intel posted second-quarter income of $12.86 billion, surpassing analyst expectations of $11.91 billion. Nevertheless, the corporate reported an adjusted lack of 10 cents per share for the quarter, falling in need of analysts’ forecast of a one-cent revenue. The income for the foundry division was $4.4 billion, up 3% year-over-year.