How do we know Intel Foundry is barely in the price of Intel?
If you asked Mag7 + AI Labs if they could own their own chip manufacturing supply chain for $400B they would jump at the opportunity
1 Intel Fab is 8 gigawatts a year for $30B in CAPEX
Intel Foundry OPEX added to Google would be a 15% bump to R&D, 10% for Amazon etc.
If they wanted to invest to produce memory in the future it would be an additional 7.5% and 5% bump. R&D cost is peanuts for them.
The margin capture in design and manufacturing of semiconductors is a huge expense for upstream customers.
The reason Mag7+AI labs can't enter semiconductor manufacturing is Fabs are an intractable moat. Intel ex product design biz values the fabs at a 1 P/B. Arguably almost 0 if DCAI grows as expected next year.
$INTC
im not even kidding i think there's been like 5 instances of jim cramer tweeting how $INTC is a no brainer buy and it instantly tanks after, the guy is incredible
@ScroogeCap It doesn't matter - market doesn't reward capex in this environment. Company will NEVER say that they have customers locked up - therefore this will always just be speculative capex with no safety net in the market's eyes.
@GoForGrubes2 Got it. I'm done trying to predict Iran. I really thought a resolution seemed likely but the maximalist demands Iran seems to be making feel unworkable for the US despite trump desperately wanting to fold IMO. I have no clue what happens from here.
@GoForGrubes2 Genuinely trying to understand - you would want Iran to be resolved for this position right since that implies oil down, inflation down, and ultimately rates down? Or am i misunderstanding?
@Intellionaire Would you rather be rich in a world of extreme abundance where the value of human labor approaches 0 - or rich in a world of scarcity where access to your wants and needs is still limited?