Intel Corp. (INTC) shares rallied sharply Tuesday, climbing more than 8% in afternoon trading, as investors responded favorably to a sweeping corporate restructuring and growing confidence in the chipmaker’s new leadership.
The surge follows weeks of investor unease surrounding the semiconductor giant’s declining margins, eroding market share, and prolonged delays in its manufacturing roadmap.
But under new CEO Lip-Bu Tan—appointed earlier this year—Intel appears to be staging a reset investors have been waiting for.
Shares of the Santa Clara-based company were trading around $22.40 as of midday, their highest level in nearly two months.
That’s a notable rebound from recent lows of $19.30, when Intel’s disappointing earnings report and weak guidance prompted widespread analyst downgrades.
Strategic Reset Underway
Tan, a veteran of the semiconductor industry and former chairman of Cadence Design Systems, has moved quickly to make his mark. In recent weeks, Intel has:
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Announced layoffs impacting over 22,000 employees, a move aimed at cutting overhead and improving efficiency;
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Reiterated its commitment to the 18A manufacturing process, a next-generation chip node crucial to competing with Taiwan’s TSMC and Korea’s Samsung;
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Accelerated its transition to a foundry-first business model, emphasizing external customer manufacturing through Intel Foundry Services (IFS).
“These moves may be painful in the short term, but they signal a decisive pivot toward execution and long-term competitiveness,” said Rajiv Sharma, a tech analyst at BMO Capital Markets.
“Investors are beginning to believe that Intel has a clear path forward.”
Talk of Breakup and Strategic Value
Wall Street is also reacting to fresh speculation that Intel may explore structural separation of its business units.
Analysts at Morgan Stanley and Bernstein have floated scenarios involving a split between Intel’s core chip design business and its manufacturing and foundry operations.
While no formal plans have been announced, the possibility of unlocking value through a breakup has piqued investor interest.
“There’s a growing case that Intel’s parts are worth more than the whole,” said a recent note from Bernstein. “Separating foundry services from product divisions could allow both to thrive independently.”
A Sector on the Rise
Intel’s rise coincides with a broader rebound across semiconductor stocks. The Philadelphia Semiconductor Index (SOX) is up nearly 2% today, buoyed by easing macroeconomic fears, a modestly dovish tone from the Federal Reserve, and a rotation back into AI and tech names.
Nvidia and AMD are also trading higher, though Intel’s gains outpace its peers—a sign that today’s move is more than just sector momentum.
Still a Long Road Ahead
Despite the rally, analysts remain cautious. Intel’s fundamentals have deteriorated in recent years, as the company lost process leadership and fell behind in artificial intelligence chips—areas where rivals like Nvidia dominate.
Gross margins remain compressed, and regaining customer trust in its foundry capabilities will take time.
According to data from TipRanks and MarketBeat, the consensus analyst rating remains a “Hold,” with an average price target of $21.50—only slightly below where the stock is trading now.
“There’s no doubt that Tan brings credibility and vision,” said Susannah Hill, senior equities strategist at Evercore ISI.
“But Intel’s turnaround hinges on execution. A few bad quarters, and investor confidence could evaporate again.”
Today’s rally may reflect more than a technical rebound—it suggests that Wall Street is willing to give Intel the benefit of the doubt under new leadership.
Whether that optimism holds will depend on the company’s ability to deliver on its roadmap, win foundry clients, and rebuild its place at the top of the semiconductor industry.
For now, investors are cheering a bold reset for a storied American tech company—one that many hope still has a vital role to play in the global chip race.
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