Intel: Cyclical Recovery or Secular Demise?

This episode is brought to you by:
Tegus. Tegus is the modern research platform for leading investors, and provider of Canalyst. Tired of calculating fully-diluted shares outstanding? Access every publicly-reported datapoint and industry-specific KPI through their database of over 4,000 driveable global models handbuilt by a team of sector-focused analysts, 35+ industry comp sheets, and Excel add-ins that let you use their industry-leading data in your own spreadsheets. Tegus’ models automatically update each quarter, including hard to calculate KPIs like stock-based compensation and organic growth rates, empowering investors to bypass the friction of sourcing, building and updating models. Make efficiency your competitive advantage and take back your time today. As a listener, you can trial Canalyst by Tegus for free by visiting tegus.co/patrick.

(00:00:15) - (First question) - Todd’s key takeaways from his involvement in the semiconductor industry over the decades

(00:02:27) - How the current industry cycle differs from past cycles

(00:04:26) - Intel’s current positioning in the industry considering its historical reputation

(00:08:21) - The key missteps that led to the challenges facing Intel

(00:11:56) - The crucial milestones assessing the success of Intel’s rebuild 

(00:15:24) - The current landscape of profit pools within the semiconductor business

(00:19:25) - Looking at how the CPU, GPU and foundry segments’ margin profiles differ

(00:22:20) - Differences between the CPU and GPU cycles

(00:25:04) - How more consolidation in the GPU market can be achieved

(00:26:03) - Potential incentivisation to diversify Intel and NVIDIA servers and chips

(00:27:46) - The extent to which major players like Google, Meta and Microsoft rely on external players in the industry and potential impacts on Intel’s growth

(00:29:29) - Intel’s plan to regain share and grow its CPU business

(00:31:49) - Signs of stabilization in Intel’s CPU market share and confidence in Pat Gelsinger’s leadership

(00:33:26) - Anticipated trend in CPU demand due to integration of AI-powered CPUs

(00:36:34) - Developments with Gaudi’s software component and the goal of making the training process more cost-effective

(00:38:02) - How Todd perceives the geopolitical dynamics surrounding Intel

(00:42:04) - Factors and developments from competitors that Todd fears

(00:44:32) - Comparing ownership of NVIDIA and Intel to niche companies in the ecosystem

(00:45:47) - Potential opportunities for Intel

(00:49:50) - Potential risks that Todd believes Intel face

(00:52:58) - Whether Todd expects this cycle duration to differ from previous cycles

(00:54:35) - The differences in semiconductor cycles based on drivers like demand drop-offs and macroeconomic factors compared to oversupply

(00:56:30) - Whether Todd believes there will be a drop-off in spending or if sustained high spending is the new normal   

(00:59:31) - Lessons learned from Intel that can be applied to other businesses