Chip-making Unit of Intel Reveals $7 Billion Operating Loss

Intel, a semiconductor company headquartered in Santa Clara, California, has reported increasing losses for its foundry business in a recent filing with the U.S. Securities and Exchange Commission. The manufacturing unit experienced $7 billion in operating losses for 2023, which was higher than the $5.2 billion losses reported in the previous year. Despite this, the unit generated $18.9 billion in revenue for 2023, a significant drop from the $63.05 billion in revenue it had the year before.

Following this disclosure, Intel’s shares fell by 2%. In an effort to improve its financial performance and turnaround its business, Intel plans to invest $100 billion in building or expanding chip factories in four U.S. states as part of its strategy to attract external companies to use its manufacturing services as a means of generating revenue and improving profitability.

To enhance transparency and accountability, Intel has committed to reporting the results of its manufacturing operations as a standalone unit. The company has been making substantial investments to close the gap with its primary competitor, Taiwan Semiconductor Manufacturing Co., by aligning its strategy with the goal of becoming a leading player in the semiconductor industry. By doing so, Intel aims to regain its competitive edge and strengthen its position in the market.

In summary, Intel’s foundry business is facing increasing losses despite generating significant revenue but it plans to invest heavily in building or expanding chip factories and attracting external companies to use their manufacturing services as a means of improving profitability and turning around their business while enhancing transparency and accountability by reporting manufacturing operations as standalone units

By Riley Johnson

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