Intel anticipates 'meaningful' revenue from manufacturing business by 2027

Intel's revenue milestone: Intel's Chief Financial Officer, David Zinsner, announced at an investor conference on Wednesday that the tech giant expects its contract chip manufacturing sector to begin generating "meaningful" revenue by 2027.

Currently, Intel is engaged in discussions with 12 potential clients, with Zinsner forecasting some revenue from these engagements in 2026, and a more substantial inflow in 2027. The company has opted to shift its focus from the 20A manufacturing process to the more advanced 18A process.

At present, Intel's foundry operations are contributing revenue through its advanced packaging services.

Restructuring and strategic shifts

The company is undergoing a major restructuring, which includes divesting several business units and implementing a 15 per cent reduction in its workforce. Intel's CEO, Pat Gelsinger, along with other senior executives, is set to present new strategies to the company's board of directors at a meeting scheduled for mid-September.

The planned staff reductions are expected to be largely finalised by the time Intel announces its earnings for the current quarter, according to Zinsner. The company is evaluating various strategies for potential business cuts and retainments.

Additionally, Zinsner highlighted that Intel is unlikely to see financial benefits from the US CHIPS Act until the end of the year. The act, which provides billions in grants and incentives, aims to boost chip manufacturing within the United States.

(With Reuters Inputs)