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Intel's Turnaround Faces Skepticism Despite Government, SoftBank Backing
26 Aug
Summary
- U.S. government converted $8.9B in CHIPS Act funding into 10% Intel stake
- SoftBank invested $2B in Intel, but not seen as a "game-changer"
- Intel's manufacturing disadvantage, AI portfolio gap, and CPU market share losses remain unresolved
As of August 27th, 2025, Intel's (INTC) efforts to engineer a turnaround are facing skepticism from Wall Street analysts, despite high-profile backing from the Trump administration and SoftBank (SFTBY).
In the past week, the U.S. government converted $8.9 billion in CHIPS Act funding into a 10% equity stake in Intel, while SoftBank invested $2 billion in the chipmaker. However, Bank of America (BofA) maintains that these moves are essentially "noise" that won't solve Intel's underlying problems.
BofA's analysis points to three critical gaps that the new investments fail to address: Intel's manufacturing disadvantage against Taiwan Semiconductor (TSM), its artificial intelligence (AI) portfolio shortfall versus GPU leaders like Nvidia (NVDA), and its ongoing CPU market share losses to AMD (AMD) and ARM-based competitors.
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The core issue, according to the analysts, remains Intel's manufacturing competitiveness. The company's foundry business is yet to secure a major customer, and its Ohio factory complex won't begin operations until 2030.
With Intel's stock losing 64% of its value last year before recovering 20% so far in 2025, BofA maintains its "Neutral" rating and $25 price target, suggesting the stock will remain range-bound until the chipmaker demonstrates real progress in addressing its industry-leading challenges.
