Intel shares are rising after a report suggests the company may sell its Foundry division

Key Points

• Intel is reportedly in talks about a possible spin-off or sale of its foundry division, which makes chips for other companies.

• The company’s shares have fallen 60% this year, making it the second-worst-performing component of the S&P 500 index.

• The company reported a loss of $1.6 billion in the second quarter, while analysts expected a loss of $1 billion for this quarter.

A report that Intel Corp. (INTC) is considering spinning off or selling its foundry business sent the tech giant’s stock price soaring on Friday.

Intel shares rose nearly 8% after the Bloomberg report, which cited people familiar with the matter. An Intel spokesman declined to comment.

Intel’s foundry business makes chips for outside companies. However, a move is unlikely in the short term, with multiple options expected to be presented at a board meeting in September, the report said.

Recent Struggle

Intel shares have fallen 60% through 2024, making it the second-worst performing stock in the S&P 500 index.

On August 1, the company announced it would lay off 15% of its workforce amid disappointing quarterly results, sending shares to their lowest level since 2013. Intel reported a net loss of $1.6 billion in the second quarter, and analysts expect another $1 billion in losses this quarter, according to the Visible Alpha consensus.

According to reports last week, construction of two new chip factories in Germany could be stalled.

Intel’s falling shares have pushed its market value below that of several other chip giants. That’s a far cry from 2021, when CEO Pat Gelsinger took the reins and the company dwarfed rivals like Nvidia.

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