In 2024, Intel stock slid by roughly 2.5 times, a setback that could push the company toward a Dow Jones rebalancing in the near term. Having joined the index in the 1990s alongside Microsoft, Intel’s reputation faces additional pressure. The reasons behind this shift and what may unfold next are explored in the following analysis.
What happened to Intel?
Over the last couple of years, Intel has seen a downward trajectory in revenue. The company remains operating, but its path has diverged from the rapid progress seen in many peers. While rivals have advanced to 5-nanometer and 3-nanometer node technologies, Intel continues to rely on 10-nanometer processes, which has limited its speed in catching up with cutting-edge rivals.
If the global market is considered, it appears management missed the momentum in artificial intelligence and did not prioritize hardware development for smartphones. Those choices contributed to a delay in catching up with competitors who moved decisively into new AI-enabled architectures and mobile ecosystems.
Meanwhile, Intel is signaling plans to launch Core Ultra and Lunar Lake processors and to optimize existing Copilot+PC offerings. These ambitions come with substantial costs. To manage expenses, the company has undertaken significant layoffs, reducing headcount by about 15,000 this year, a move that has affected brand sentiment.
Intel’s report for the second half of 2024 indicated sizable losses and a forecast of revenues about 1% lower in the near future, translating to hundreds of millions of dollars. The news contributed to cautious sentiment among shareholders, who began to trim positions on the NASDAQ, feeding further pressure on the share price.
Today, Intel’s market capitalization sits near levels seen in 2010. Internet chatter includes a humorous notion that a $10,000 stake bought years ago would be worth a penny today, though real value is impacted by inflation and market dynamics.
What brand of processor is installed in your PC?
Changes in the computer hardware market
Other industry players have sought to capitalize on the downturn. Intel has discussed acquiring a portion of its own business from Qualcomm, the U.S. chipmaker behind the Snapdragon line used in many Android devices. A broader plan to expand into personal computer hardware could involve partnerships or acquisitions that reduce the need to rebuild entire manufacturing bases from scratch. In this context, cost-cutting and strategic consolidation may help stabilize Intel’s trajectory.
There are also reports that some Intel processors could be produced at facilities owned by Taiwan’s TSMC as a temporary solution while Intel rebuilds its own factories for newer 20A and 18A generations. Engineers have worked on the theoretical framework; the practical shift will unfold toward the end of 2025. In the interim, production on legacy 10-nanometer chips may occur abroad, a strategy that could raise short-term costs but aims to accelerate a broader transition.
Can Intel Survive the 2024 Crisis?
There is no single consensus. Yet, some resilient histories offer perspective. For instance, IBM weathered steep declines and later recovered to reestablish strength. Intel, too, has faced periods of sharp pressure, including intense rivalry with AMD. The brand remains widely recognized and trusted by millions around the world, and the current downturn could serve as a catalyst for retooling toward new technological frontiers.
Notably, Intel remains a unique player in processor development, handling the full cycle from microcode to silicon. Its extensive patent portfolio continues to be a valuable asset, whether leveraged internally or monetized through licensing. Those reserves provide a solid foundation for navigating current market volatility and pursuing long-term reinvestment in core competencies.
The Dreamcast example and Sega’s broader hardware decisions illustrate how strategic missteps can alter a company’s trajectory: strong ideas falter if policy and execution don’t align. Conversely, successful pivots show that leadership, prudent investment, and clear roadmaps can keep a company competitive even in rough seas.
Will Intel emerge stronger from the current stagnation, or will the company face a forced reorientation? Readers are invited to reflect on these questions as the market evolves and new processor architectures take shape.
What is your take on Intel’s ability to navigate the present crossroads?