Key points
- Intel shares rose 220% over twelve months, reaching $70.32 — the highest price in twenty-five years
- New CEO Lip Bo Tan has cut more than 20,000 jobs and restored positive free cash flow during the last half of 2025.
- Nvidia allocated $5 billion to Intel operations; Partnerships include Alphabet and Elon Musk’s Terafab initiative
- Q1 2026 financial results arrive on April 23 — and high expectations could lead to price volatility
- One analyst expects shares to reach $150 by 2029 if margin expansion and earnings growth materialize
Intel’s recent performance represents one of the most notable returns to the semiconductor industry. After touching multi-year lows near $18 in June 2025, shares rose to $70.32 — their highest in twenty-five years — with a remarkable 58% rally compressed in just nine trading sessions. Many investors are now wondering whether the opportunity has passed or whether the uptrend is still in place.
The story of the turnaround revolves primarily around Lip Bo Tan, who took over as CEO in March 2025. A veteran venture capitalist with experience in corporate turnarounds, Tan had previously led Cadence Design Systems to an astonishing 3,200% rise during his twelve-year tenure. When he joined Intel, he acted decisively. Workforce reductions exceeded 20,000 employees while capital expenditures were reduced. Free cash flow, which registered a negative drain of $44 billion from 2022 through 2025, finally turned positive in the second half of the previous year.
Intel The product portfolio has gained new momentum as well. The chipmaker has unveiled its Core Series 3 mobile processors that use an advanced 18A manufacturing process, designed to handle routine AI workloads while increasing the battery performance of consumer laptops.
Strategic cooperation in the field of artificial intelligence represents a new trend
Intel’s strategy extends beyond just cutting costs, it represents a serious challenge in the artificial intelligence sector. The company has established partnerships with Alphabet focusing on AI capabilities and cloud computing infrastructure. In addition, Intel is collaborating with Elon Musk on the “Terafab” project, a semiconductor manufacturing joint venture linking SpaceX and Tesla.
Then comes Nvidia. Last September, Nvidia Intel has poured $5 billion into manufacturing specialized x86 server processors designed to work seamlessly with Nvidia GPUs. Ben Ritzes, an analyst at Melius Research, put it bluntly: “Demand for x86 server CPU has gone through the roof in hyperscalers. x86 has become an AI chip.”
This represents a fundamental shift in market perception regarding Intel’s place within AI infrastructure.
However, the dramatic rise has pushed valuation metrics into stretch territory. Intel currently generates earnings at roughly 95 times expected earnings, exceeding the valuations of Nvidia, Taiwan Semiconductor, Broadcom, and AMD. Gross margins hover below 40%, which contrasts sharply with Taiwan Semi’s 55% and Nvidia’s 75%.
Production efficiency is a constant challenge
Much of the margin disadvantage stems from manufacturing capabilities. Intel currently exports approximately 30% of its chip production to Taiwan Semiconductor Corporation while expanding internal manufacturing capacity. Production rates in the advanced manufacturing process are estimated at around 70%, compared to 90% in Taiwan Semi.
If these returns rise as the technology matures, profitability margins are likely to follow suit. Analyst Ritzes expects Intel to be able to achieve earnings of $7 per share by 2029. Applying the semiconductor industry benchmark to 22 times forward earnings produces a theoretical price target of $150.
Wall Street sentiment remains measurable. Nearly one in five analysts who follow Intel maintain a buy recommendation, which significantly lags the S&P 500 average of 55%. The consensus target price is $51.25, which is significantly lower than current trading levels.
Institutional money managers are quietly building their positions. ZEGA Investments created a new stake during the fourth quarter. Executive Vice President David Zinsner bought nearly $250,000 worth of stock last January.
Intel will report first-quarter 2026 results on April 23.
