Intel’s chip manufacturing business suffered a $7 billion loss last year.

In today’s technology landscape, Intel’s semiconductor manufacturing division is in a crucial phase of transformation. After a year 2023 marked by operating losses which amounted to 7 billion dollars, surpassing 5.2 billion losses in 2022, Intel has made significant strategic moves under the leadership of its CEO, Pat Gelsinger. Despite these seemingly disappointing figures, with revenues down 31% to $18.9 billion from $27.49 billion the previous year, the picture is not as bleak as it seems.

The challenges faced by Intel did not come without warning. Subcontracting of around 30% of its production to competitors like TSMC was a pragmatic choice in the context of past strategic errors, especially related to its foundry business. However, the recovery already seems to be underway, thanks to significant investments in promising technologies. One of Intel’s most significant bets was the adoption of extreme ultraviolet (EUV) machines of the Dutch company ASML, an initiative that Gelsinger considers decisive for the takeover of the company.

Intel’s goal is ambitious but clear: to break even by 2027. EUV technology will play a key role in this ambition, making mass production more affordable for players like Intel. This approach is part of a broader expansion plan, where approximately 100 billion dollars will be devoted to the construction and expansion of its foundries in the United States, a project which will also benefit from government financial support to the tune of $8.5 billion thanks to the new CHIPS law.

For the company to restore its financial balance and prestige in the semiconductor industry, convincing large technology companies to use its manufacturing services becomes imperative. With Microsoft already as a customer, Intel’s future success will depend on Gelsinger’s ability to attract enough major players. The next few years will therefore be pivotal in Intel’s turnaround story, a story of adaptation, visionary investment and regaining a leadership position in the intense and competitive world of semiconductor manufacturing.