2025 will be a pivotal year for chip giant Intel (INTC 0.85%) Because they are at the helm of an industry they no longer have any control over. A years-long turnaround effort led by former CEO Pat Gelsinger that aimed to turn Intel into a world-class foundry has yet to bear fruit as the company struggles on multiple fronts.
In the PC market, a combination of weak demand, intense competition from AMD, and Qualcomm’s launch of Arm-based laptop CPUs has left Intel fighting for market share. In the data center market, Intel has been reeling from years of product slump, AMD’s stunning comeback, and a shift in spending toward artificial intelligence (AI) chips. And in manufacturing, foundry customers have seen little success as Intel works to complete its initial process technology roadmap.
Intel will enter 2025 without a permanent CEO and with a strategy that is somewhat up in the air. This year will be an important year for the company.
Requires Intel 18A to work
The final process node on Intel’s initial foundry roadmap is Intel 18A. The company expects the process to be the best in the industry at launch, packed with features such as new transistor designs and backside power delivery. Although the company has completed its post-18A roadmap, its entire foundry strategy depends on the success of Intel 18A.
Intel 18A is expected to be ready for mass production in early 2025, but it will take time for production to ramp up. The company has acquired several major Intel 18A customers, including Microsoft and Amazon, but it’s unclear when these deals will start generating meaningful revenue for outside foundries. Currently, essentially all of Intel’s foundry revenue is generated internally and from the company’s various product segments.
Intel plans to reach $15 billion in annual external foundry revenue by 2030. That ambitious goal requires Intel 18A to deliver on its promise and launch on time. Delays or failures would not only derail the foundry business, but could be devastating for the company since its next-generation products depend on Intel 18A.
Advances in PC and server CPUs
Despite some setbacks with the latest Arrow Lake PC CPUs, Intel has a pretty strong competitive edge in the PC CPU industry. The company has also established itself in the server CPU industry with its Sierra Forest and Granite Rapids CPU families, but customers continue to focus on AI chips, an area where Intel lags.
In 2025, Intel is planning big announcements in both markets. In the PC market, Intel is planning to launch Panther Lake in the second half of this year. After Lunar Lake and Arrow Lake both outsourced production to TSMC, Panther Lake will bring most of its manufacturing back in-house. The most performance-critical parts of Panther Lake use Intel 18A processes.
In the server market, Intel should prepare Clearwater Forest to go live next year. Like Sierra Forest, Clearwater Forest is an efficiency-focused processor that consists of a large number of energy-hungry CPU cores.
This chip is ideal for cloud-based workloads and other applications where core density is more important than raw performance. Like Panther Lake, Clearwater Forest is built on the Intel 18A process.
If Intel 18A is delayed or encounters problems, Intel’s product roadmap will be challenged.
find a new CEO
The sudden retirement of former CEO Pat Gelsinger has left Intel with an interim co-CEO and a lack of strategic clarity. The company will need a new leader sooner or later, and an outsider may be needed to shake things up enough.
Changing a culture where once-dominant industry leaders are set in their ways is an extremely difficult task. Whoever takes the top job will face some serious challenges as they attempt to restore Inter’s former glory.
Upcoming stocks heading into 2025
It’s no surprise that Intel’s stock price has plummeted given all the uncertainty and upheaval plaguing the company. But the company is in a unique position as the only U.S.-based manufacturer of advanced logic semiconductors. The stock is currently trading well below book value, indicating that the market is highly pessimistic.
Intel is undoubtedly struggling, but it has a solid product roadmap and a foundry business with long-term potential. With the right leader and the right strategy, Intel stock could be a big winner over the next decade.
John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of the Motley Fool’s board of directors. Timothy Green has a position at Inter. The Motley Fool has positions in and recommends Advanced Micro Devices, Amazon, Intel, Microsoft, Qualcomm, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends the following options: A January 2026 $395 long call on Microsoft, a February 2025 $27 short call on Intel, and a January 2026 $405 short call on Microsoft. The Motley Fool has a disclosure policy.
