To The Moon

The uncomfortable truth first: Intel has now surged more than 300% from its 2025 low of $17.67, hit an all-time high of $142.32 in June, pulled back to the low $80s in July, and is now at $89 with this week's 11% move adding another leg. At every step of that run, the same debate has repeated. Is this a genuine foundry turnaround or a series of headline-driven pops on a business still losing money? Thursday's catalyst, the expansion of Intel's foundry toolchain for AI chip customers, is the latest entry in that debate. It is also one of the more substantive ones.

Here is what actually happened. Intel expanded its purpose-built silicon business beyond networking and IPUs through the Fortinet Security Processor 6 collaboration. The company confirmed 18A-P has entered risk production on schedule. Panther Lake, the first major Intel product on 18A using ASML's High-NA EUV, is in high-volume manufacturing. Most significantly, Intel gave a new startup access to some of its processor technology, signalling that Lip-Bu Tan is pursuing a broader ecosystem strategy rather than just chasing marquee customers. Against that, the Q2 actual print deserves scrutiny: revenue of $16.1 billion was 25% above the prior year, Data Centre and AI revenue surged 59% to $6.3 billion, gross margin hit 41.8%, and EPS came in at $0.42 against a $0.13 consensus estimate. Q3 guidance sits at $15.8 to $16.8 billion. By any conventional metric, this is no longer a turnaround story in its early innings. It is a turnaround in execution.

The problem is the valuation, the GAAP losses, and the 31 Hold ratings against 12 Buys on a stock that a top analyst has at $160.

The Foundry Toolkit Is the Right Move. But Timing Is Everything.

The expansion of Intel's design and manufacturing toolkit for AI chip customers addresses the specific reason fabless companies have historically avoided Intel Foundry. It was not just about process node performance. It was about ecosystem depth. TSMC has 35 years of EDA tool integrations, reference flows, IP libraries, and design support infrastructure. A fabless company choosing between TSMC and Intel Foundry was not just choosing a manufacturer. It was choosing an entire design ecosystem.

Intel's recent moves are specifically targeting that gap. The Fortinet collaboration is not just a chip order. It is Intel demonstrating a complete design-to-manufacturing service for a security processor customer. The startup access programme signals that Intel is building the bottom of the funnel, attracting smaller customers who will create the reference designs and tape-out experience that larger customers require before committing. The 18A-P node's on-schedule risk production confirms the manufacturing timeline is holding.

What remains unconfirmed is the most important thing: a large fabless customer committing meaningful production volume. Google's reported order for 3 million TPU chips by 2028 was the most concrete external customer signal. NVIDIA's evaluation of 18A for complex multi-chip designs is promising but not a contract. Apple has been flagged as a possibility. None of these are revenue today. All of them are directionally correct signals about where the customer pipeline is pointing.

Intel gave a new startup access to processor tech on July 29, which was framed positively in the market. The strategic logic is sound. But the foundry business still posted operating losses in Q2. The gap between toolkit expansion and positive foundry economics is measured in years, not quarters.

The Q2 Beat Was Bigger Than Most People Processed

The headline from Intel's earnings last week that did not get enough attention: $16.1 billion revenue was 12% above analyst estimates. That is not a narrow beat on sandbagged guidance. That is a structural demand acceleration. Data Centre and AI revenue at $6.3 billion, up 59% year on year, has now overtaken expectations in a way that suggests the AI PC and agentic computing thesis is arriving faster than even bulls modelled.

18A yields at 85%, up from 65% the prior quarter, is the technical proof point that matters most. ASML confirmed Intel is the first company delivering high-volume logic chips on High-NA EUV. That is not a minor footnote. It is a manufacturing leadership data point. Intel is not merely closing the gap to TSMC. On High-NA EUV, it is ahead of it. The financial benefit of that lead will not materialise until external customers choose 18A at scale, but the technical leadership claim is now substantiated by an independent third party, which is categorically different from Intel's own commentary.

Q3 guidance of $15.8 to $16.8 billion midpoint implies Intel is guiding for roughly flat to slight sequential revenue. That guidance conservatism after a 12% beat is the same pattern that has characterised every quarter under Lip-Bu Tan. Under-promise, over-deliver, repeat. The seventh consecutive quarter of beating guidance is the expected outcome if the pattern holds.

What Retail Traders Are Right and Wrong About

The valid bear points: Intel still has a GAAP net loss. The foundry business is still posting operating losses. At current prices near $89, the stock trades at a forward PE of approximately 123x on non-GAAP earnings, which is extraordinarily elevated for a business that has not yet proven foundry unit economics. The analyst consensus is 31 Holds against 12 Buys. The average consensus price target is $107.93 to $115.27, which implies upside from current levels but also implies the consensus does not think this stock deserves the premium it briefly received at its $142.32 all-time high.

The invalid bear points: the assumption that 300% from the lows means the stock has no further legitimate upside ignores the fundamental step-change in Intel's business. Revenue up 25% year on year, DCAI up 59%, 18A yields at 85%, High-NA EUV leadership confirmed by ASML, Q2 EPS more than 3x above consensus, are not characteristics of a business that deserves to be discussed in the same frame as a company with execution problems. The bear who is short Intel at $89 based on valuation is not wrong about the multiple. They may be wrong about the trajectory.

The GAAP loss issue is real but partially misleading. The $11 billion GAAP net loss in Q2 included impairments and restructuring charges. The underlying operating performance, at 41.8% gross margin and positive non-GAAP operating income, is fundamentally different from a company that is genuinely unprofitable in its core business.

Specific Predictions for Next Week

INTC enters the week at approximately $89, down 1.10% post-session as seen in the Tiger data. Here are the specific directional calls for the week of August 4.

Base case: $88 to $97. The most likely outcome is consolidation after the 11% single-day move. The catalyst that drove Thursday's surge, the foundry toolkit expansion and customer access programme, is a medium-term positive that the market partially priced in immediately. Without a new headline, the stock digests the move in the $88 to $97 range. The 31 Hold analyst majority means institutional buyers are not aggressively adding at these levels. The technical level to watch is whether $89 to $91 holds as support after the prior pullback from $142.

Bull case: $97 to $108. Requires one of: a confirmed NVIDIA or Google foundry order moving from evaluation to contract, a further analyst upgrade, or a positive read-through from the broader semiconductor sector if memory stocks continue recovering. The $107.93 consensus target is the natural ceiling for near-term institutional buying. A move toward that level would require either news flow or a continuation of the risk-on semiconductor trade that memory stocks triggered last week.

Bear case: $78 to $85. Requires one of: a fresh AMD data centre share gain announcement, any signal that 18A external customer wins are not materialising as fast as hoped, or a broader tech selloff driven by the Fed's September hike probability rising above 50%. The $89 stock with a 123x forward PE and GAAP losses is legitimately vulnerable to any macro tightening signal.

The specific level to watch Monday morning: $91 to $92. If INTC opens above $91 and holds through the first hour, that is the institutional confidence signal that the toolkit expansion catalyst is being bought rather than faded. If it opens below $88 and stays there, the stock is distributing after the 11% pop and the next leg is lower before any new fundamental catalyst.

The most important upcoming catalyst for INTC next week is not Intel-specific. It is the Fed's September hike probability. If August macro data suggests Warsh is leaning toward September action, high-multiple semiconductor names compress across the board and INTC at 123x forward PE is among the most exposed. That macro risk is the primary variable that no amount of foundry toolkit news can offset.

The honest one-week call: $88 to $95 with more conviction than the bull or bear tails. The story is right. The execution is improving. The valuation is demanding. In a market without a fresh catalyst, the three of those together produce sideways to slightly positive tape rather than another 11% leg.

I am not a financial advisor. Trade wisely, Comrades.