MW Intel's stock is rising - and this time it's not because of sale rumors

By Emily Bary

Nvidia and Broadcom reportedly are testing Intel's manufacturing technology. That's a potentially encouraging signal for the business.

Intel Corp. shares surged 22% in February, partly on hopes that the chip maker could engage in a sale of all or parts of its business.

But Intel's stock $(INTC)$ was moving higher on Monday for a different reason, and one that has more to do with the company's actual business. Reuters reported that Nvidia Corp. $(NVDA)$ and Broadcom Inc. $(AVGO)$ are testing out the company's 18A manufacturing technology.

Intel shares are up more than 2% in morning action.

An Nvidia spokesperson declined to comment on the report. Representatives from Intel and Broadcom didn't immediately respond to MarketWatch's request for comment.

It's still too early to determine whether the tests will lead to new business for Intel, but they come at a time when investors have doubted whether Intel's manufacturing business can stand on its own. Prior reports indicated the possibility of a deal in which Taiwan Semiconductor Manufacturing Co. $(TSM)$ (TW:2330) would take over Intel's fabrication plants.

"My view is just the potential of 18A and foundry success takes [Intel's] stock MATERIALLY HIGHER," Mizuho desk-based analyst Jordan Klein wrote in a note to clients Monday.

See also: The Chips Act may be dead. That's another big hurdle for semiconductor stocks.

The report doesn't mean that Intel's foundry issues are solved, nor does it mean Nvidia or Broadcom will end up using Intel for manufacturing, Klein wrote. Rather, it indicates that Intel's 18A process "is not a total lost cause" and that the company "could survive (maybe even thrive) in future as a secondary leading edge foundry supplier to TSM," he said.

The rally in Intel shares Monday comes as the market is also digesting some not-so-great news for the company, which is that Intel has delayed the opening of two Ohio fabs. The company now expects it will begin operations in those locations in 2030 or 2031, after completing the first fab in 2030. The Wall Street Journal reported that Intel once was targeting a 2025 completion.

"We are taking a prudent approach to ensure we complete the project in a financially responsible manner," the company said in a Friday blog post.

-Emily Bary

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March 03, 2025 10:21 ET (15:21 GMT)

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