Jim Cramer said Intel's foundry problems have been solved under the leadership of CEO Lip-Bu Tan during a May 18 interview [1].
This development is significant because Intel is attempting to pivot its business model to compete with TSMC and Samsung by manufacturing chips for other companies. A successful foundry turnaround would reduce Intel's reliance on its own chip designs and open new revenue streams from external tech giants.
During the interview on CNBC’s ‘Mad Money’ program, Cramer said that the foundry unit is gaining momentum [1]. This shift follows a period of manufacturing struggles that hampered Intel's ability to compete at the leading edge of semiconductor technology.
Lip-Bu Tan said the foundry business is seeing increased interest from multiple customers [2]. The company has already signed foundry deals with Tesla and Google [3], two major players in the AI and automotive sectors.
Tan said that improved manufacturing yields are a primary driver of this current momentum [2]. Higher yields mean fewer defective chips per wafer, which reduces costs and makes the service more attractive to outside clients.
Looking toward future technology, Intel's 14A node is scheduled to enter risk production in 2028 [4]. This roadmap indicates the company's long-term strategy to regain process leadership in the industry.
Cramer's assessment suggests a confidence in the operational changes implemented under Tan. The company continues to pursue commitments from multiple customers to scale the foundry business [2].
“Intel's foundry problems have been solved under CEO Lip-Bu Tan”
Intel's transition to a foundry model is a high-stakes gamble to diversify its income and regain a competitive edge in manufacturing. By securing partnerships with companies like Google and Tesla, Intel is attempting to prove it can meet the rigorous standards of external clients. If the company meets its 2028 production goals for the 14A node, it could fundamentally shift the global semiconductor landscape by providing a viable Western alternative to Asian fabrication plants.
