Intel (Intel (INTC)) shares are up in Friday's premarket session, trading 1.16% higher, as chip-supply headlines and firmer index futures keep attention on U.S.-based manufacturing options. The catalyst? Reports that Apple (Apple (AAPL)) executives have held early conversations with Intel about using its foundry services.
According to reports, Apple executives have also visited a Samsung Electronics (Samsung (SSNLF)) facility under construction in Texas, as the iPhone maker explores ways to reduce its reliance on Taiwan Semiconductor Manufacturing Co. (TSM). The discussions are described as preliminary and have not resulted in orders, with Apple weighing concerns about reliability and the ability to scale non-TSMC production technologies.
Intel CEO Lip-Bu Tan has revived investor optimism by strengthening ties with major tech companies, improving Intel's standing in AI infrastructure discussions, and pushing the company to rebuild its manufacturing credibility after years of setbacks, Bloomberg reported on Friday.
Lip-Bu Tan Revives Intel's Industry Relationships
Since taking over as CEO, Tan has focused heavily on customers and strategic partnerships. Apple and Tesla (Tesla (TSLA)) have reportedly shown interest in Intel's manufacturing operations, while Tan also strengthened ties with political and industry leaders, including President Donald Trump and Dell Technologies (Dell (DELL)) founder Michael Dell.
Tan also worked directly with Elon Musk on plans tied to a large semiconductor manufacturing project, signaling Intel's effort to regain relevance in the AI-driven chip industry.
Analysts And Executives Say Intel Still Faces Major Challenges
Despite growing optimism, Intel executives and analysts said the company still faces deep operational and competitive hurdles. Intel factory head Naga Chandrasekaran said the company must improve manufacturing quality and regain trust from both internal product teams and external customers. He added that Intel products alone cannot fully support the scale needed for a successful chip manufacturing business.
Daiwa Capital Markets analyst Louis Miscioscia told Bloomberg that potential customers remain hesitant to shift production to Intel because switching suppliers carries high costs and risks. New Street Research also highlighted Intel's manufacturing struggles, estimating that the company's cost per chip remains far above TSMC's, partly because Intel's yield rates lag those of industry leaders.
Investors Bet On Intel's AI Recovery
Investor sentiment improved after Nvidia (Nvidia (NVDA)) CEO Jensen Huang highlighted the growing importance of central processing units in AI data centers, a positive signal for Intel's core business. Bloomberg noted that renewed optimism surrounding AI demand and Intel's manufacturing ambitions helped push the stock to record levels after years of underperformance.
Analyst Outlook
The stock carries a Hold rating with an average price forecast of $72.12. Recent analyst moves include:
- RBC Capital: Sector Perform (Maintains Forecast to $80.00) (May 4)
- Tigress Financial: Buy (Raises Forecast to $118.00) (April 30)
- Freedom Broker: Upgraded to Buy (Forecast $100.00) (April 28)
INTC Price Action: Intel shares were up 1.68% at $111.45 during premarket trading on Friday. The stock is trading near its 52-week high of $114.51.
