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Intel: Fear When Others Are Fearful Because Fearful Ones Have A Point

May 25, 2023 10:00 AM ETIntel Corporation (INTC)AMD, TSM84 Comments
Vera Glebova profile picture
Vera Glebova


  • The fall in consumer demand for electronics due to the macroeconomic situation will continue to put pressure on the financial results of Intel.
  • The technological gap between Intel and AMD is still wide.
  • Intel's FCF and net income are in a deep negative zone.
  • You shouldn't be greedy when others are fearful this time.

Entrance of The Intel Museum in Silicon Valley.


Main thesis

Intel's (NASDAQ:INTC) value has been decreasing for over 2 years now and there are no signs of improvement. In fact, it's only getting worse: the technological gap is widening and the health of the balance sheet is deteriorating. The corporation's

This article was written by

Vera Glebova profile picture
I am an independent research writer analyzing macroeconomic field and individual stories while focusing on providing ideas with high returns in the long- and medium- term. My approach involves monitoring various economic indicators in order to recognize the market background now and in a specific period of time, as well as modelling various situations that I believe will help readers to better understand my investment thesis.For any questions and suggestions please reffer to my email: dz7geoo@gmail.com

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (84)

Chris Lau profile picture
Nvidia inadvertently handed Intel a gift. It refused to increase the performance of the mid-tier ADA gaming cards. Intel can do what it does best: be a slow giant that has lots of time to get Intel Battlemage and Celestial GPUs to market in 2024.
You're right, only if you're fear is based on facts not press releases and unsubstantiated comments made by others. This Intel Onion has too many layers, for me I am pulling back each layer slowly before I make any judgments. We the people, are impatient and don't have the time and patience to do the tedious legwork.
abdulmoiz1254 profile picture
As opposed to ?

All fearful ones have a point

There is no such thing as pointless fear
Skagit profile picture

Santaphobia - fear of Santa Claus - is vastly overrated.
I'm no great fan of Intel, but the claim that the technological gap between Intel (lagging) and AMD (ahead) remains wide does seem rather behind the curve. There's plenty of evidence that in many areas Intel is closing/has closed the gap. Given it's blunders over the past 10 years, it's also easier for Intel to improve than for AMD to squeeze out incremental improvements from a higher base.

Note: I'm not commenting on the latest Intel-vs-nVidia stuff here - purely the Intel-vs-AMD comment.
Dividend Pro profile picture
Kudos on your article title. Sometimes it is very true.
PVC peak >2EF estimates are based on FP64, minus a substantial estimate for moving data around. The actual FP64 processing power is >3EF. Just do the math for over 10K nodes, 6 gpus per node, 52TF FP64 per gpu. But that is all SIMD... not the matrix side that would be available for AI processing.

The LLM training would be done with the BF16 processing which is 16x greater than their FP64 because of their big matrix engine. So, we're talking around >48EF peak. With the large batch processing data streaming features, and the big Optane storage ... this is why Argonne is moving immediately to create trillion parameter models for science on their >10K nodes.


"52 TFLOPs of FP64/FP32 compute, 419 TFLOPs of TF32 (XMX Float 32), 839 TFLOPs of BF16/FP16 and 1678 TFLOPs of INT8 horsepower."
oak8292 profile picture

“And as it turns out, that is not a correct conclusion to jump to. We had a hunch it wasn’t. Intel confirmed with us what the speed of the Ponte Vecchio GPU used in Aurora was.

What Argonne is actually getting is a Ponte Vecchio GPU rated at 31.5 teraflops, which is 61 percent of the peak performance of a standalone GPU, which means Aurora is only delivering just a hair over 2 exaflops of peak double precision floating point oomph. Intel has been clearly adding node counts to get above that 2 exaflops peak, and is not going to be adding one node more.”

@oak8292 The Linpack benchmark tests aren't what will be running for LLM training. They'll run batch sizes optimized to reduce memory transfers for the target architecture. On PVC, the architectural advantages are its 408MB of L2 SRAM and the 839TF of BF16 matrix processing.

oak8292 profile picture

“The actual FP64 processing power is >3EF.” A reporter at The Next Platform talked to Intel and this is not true.
Shookmeister profile picture
Intel's management should be in awe of NVDA's jaw dropping guidance. Could this be a Nokia moment where they miss the next generation of the data center?
Intel CEO focused on hanging out with Biden while the competition focused on AI and next generation platforms
irsh profile picture
Lots of drama queens in here today.
Microsoft demonstrating Meteor Lake's VPU processing within Microsoft's new integrated Windows AI processing framework... Olive, onnxruntime, DirectML. Demo of the VPU doing audio transcription and used with an Adobe app for video editing.

AnimeSnoopy profile picture
The voices in your head are real... And you should probably listen to them bc they might be right
UndiversifyBC profile picture
If anything, NVDA shows GPUs are where it's at. Been watching Intel's steps there. Seems OK, not good, but OK. Certainly disrupting the low end. But NVDA seems to have a lock on the top end. Think I saw something like they were getting $40k per top end GPU chip. Thanks to AI mania. INTC really has to solidify their low end entry and start moving up the GPU chain. But I have my doubts about their commitment and ability to do this. But I'll keep watching.
Karl Kelly profile picture
Well said. I’ve been tempted a few times to buy Intel but never do. Your list is a much better summary of why than what I could come up with. As you said, Intel is troubled and really has nothing to offer a new stock holder.
Diesel profile picture
This company might not be around in the next decade unless they fix their issues very quickly.
Intel and MSFT collaborating on confidential computing solutions in Azure.

@jayn exactly...It is funny to think the US government is behind Intel on numerous efforts and people act like they might not be around in 10 years. Intel stole the cheese a while ago and the stock will be @$100 in 3 years,
@Lesson Conversely, If Intel was so great, why does it need governments backing so much? Why are the competition stronger DESPITE political headwinds?
C185 profile picture
The only "government backing" Intel is getting is for the Intel Foundry Services, and the US government came to Intel to initiate that. Even with the subsidies Intel is receiving, they're much less than what TSMC receives from the Taiwanese government, and TSMC has been receiving subsidies since the company began.
Intel CEO just needs to start talking about "AI" to the public, mention AI 40 times in their next earnings conference call and the stock price will soar 25%. J/K :)

Totally agree with the Author. Intel is basically dead money for the coming many years. They are so behind nVIDIA, AMD, TSMC. No AI chips. Poor management. Probably down to $20 below otherwise I will be staying 6ft away.
@Ronaldo123 Intel taped out a Gaudi 3 AI chip recently that will launch next year. They captured an MLPerf category again this year with Gaudi 2, so there is nothing shabby about their AI capability.
Lots of short term thinking in the semi space lately. Watching Tower deal closely. Intel is building a globally distributed counter to Taiwan concentrations. TSMC clearly already sees the threat.
Deal is not going well
Diesel profile picture
Funny the deal could get blocked by China who also poses a huge threat to TSM.
Or none.
S_Archer profile picture
At this point, I keep seeing a meme. Lisa Su and Jensen Huang dunking Pat Gelsinger into a toilet giving him a swirly. Pat is crying "stop bullying me! waaahhh!"

Oh well, once Intel is shipping from those 6 new fabs Pat promised would open in 2025, all will be well.
19432511 profile picture
Another 50% drop from here would be fair.
Ok. So Intel has had its fair share of execution risks. And its priced accordingly. I think the real question yet to be answered is have they turned the corner snd can they deliver competitive products on time with good yields. And will their Gross margins return to the mid 50’s to low 60’s. If they do the stock should perform well from here. If not = IBM.
@tennkid The dreaded IBM fate where you’re only worth *checks notes* 112 billion dollars.
@MechanicalWatchman IBM used to boast they would soon be bigger than Switzerland.

Only another 700 billion to go.

Everything in life is relative
Diesel profile picture
Even IBM is currently in a better shape than INTC.
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