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Intel: Raising Cash Through Mobileye

Jun. 06, 2023 5:11 AM ETIntel Corporation (INTC)MBLY21 Comments
Bill Maurer profile picture
Bill Maurer


  • Intel plans to sell 35 million Class A common shares of driver-assistance technology company Mobileye, potentially raising over $1.65 billion.
  • The sale will help improve Intel's balance sheet, which has been impacted by plunging revenues and high capital expenditure.
  • Intel will still hold a majority of Mobileye shares, showing its continued faith in the company's growth prospects.

Side view closeup of woman hand showing fan of dollar banknotes, arm holding cash, lot of money.


Back in late April, I detailed how chip giant Intel (NASDAQ:INTC) had shown some progress with its Q1 earnings report. Both top and bottom line results were not as bad as previously feared, and guidance was a

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Bill Maurer profile picture
I am a market enthusiast and part-time trader. I started writing for Seeking Alpha in 2011, and it has been a tremendous opportunity and learning experience. I have been interested in the markets since elementary school, and hope to pursue a career in the investment management industry. I have been active in the markets for several years, and am primarily focused on long/short equities. I hold a Bachelor of Science Degree from Lehigh University, where I double majored in Finance and Accounting, with a minor in History. My major track focused on Investments and Financial Analysis. While at Lehigh, I was the Head Portfolio Manager of the Investment Management Group, a student group that manages three portfolios, one long/short and two long only. I have had two internships, one a summer internship at a large bank, and another helping to manage the Lehigh University Endowment for nearly a year. Disclaimer: Bill reminds investors to always do their own due diligence on any investment, and to consult their own financial adviser or representative when necessary. Any material provided is intended as general information only, and should not be considered or relied upon as a formal investment recommendation.

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Comments (21)

SuperPac profile picture
Intel must cut dividend. They must sell more of Mobileye and retain only a minority stake.

Use the cash from above to retire some of their debt. Their net debt is over $20B and that's not good when their topline is struggling and the credit rates are ticking up. Keep the balance sheet stable while putting business back on track.
Mobileye had a couple of big partnerships announced since Intel's last sale. VW and Porsche announced.


Their most important feature is that their long driving videos are boring. They are going a different route, with explainable AI and combining lidar, hd radar and wide angle cameras and their REM mapping. My take is that their CTO has been able to design an AI system that only improves... maybe more like an expert system than the gaming type of solutions.

NOT a sign of faith selling off shares. Either desperation or lack of faith. If it were that promising then would hang onto it.
@zver11 They still have a lot of it. Probably just need to raise some cash.
I said it before. INTC created an ATM called Mobileye.

4010 INTC shares @31.91
@Doobie80 But Intel didn't create MobileEye. They bought an already established business.

I know they bought it. They created an ATM with Mobileye when they decided to spin it off.
@Doobie80 Intel created a group with around a thousand engineers to help improve Mobileye. They are contributing the hd radar, the silicon photonics lidar, the global map collection, integration into Moovit, the fleets of test vehicles... a complete solution with a target of making it affordable for consumers... even as a retrofit.

A lot of that should come together over the next couple of years as their radar and lidar mfg matures.
Sighcopath profile picture
Nice bullish article about MBLY and INTC. The author said in the article:
"Intel still will hold a majority of Mobileye shares for the indefinite future, so it still believes in the future of the company, which is expected to grow revenues quite substantially in the coming years."

My understanding ( I am bearish on INTC and MBLY) is that INTC only sold 5% of the MBLY stock at the divestiture of MBLY to try and keep the valuation of MBLY elevated and to limit the ability of "shorts" to trash the share price. The "Float" of MBLY shares is 51.12 million shares and the percentage of the floated shares shorted is at (26.31%) 13.66 million shares.

Going to be very interesting to watch the share price as INTC sells its 35-40 million shares and the shorts don't exit their positions until MBLY drops drastically. The only good thing about this INTC sale is that the percentage of short interest of the float will go down.

MBLY trades on average 2.03 million shares daily. It would take around 6.5 days for the shorts to clear positions based on average daily trading volume. Any time the clearance needs 5 days or more a short squeeze could happen. The release of 35 million shares by INTC should help alleviate any concerns about a short squeeze. MBLY is/was valued on 51 million shares trading while the remaining INTC owned Class B MBLY shares were used to discount the current value of the MBLY float. On 4/27 MBLY traded 21 million shares and dropped from $43 to $36 with a low of $30 that day.

This sales announcement by INTC is not a bullish move for either company!
Had not noticed how high the short has become....ugly.
@Sighcopath Note also that Intel is selling Class A stock with 1/10th the voting rights of the Class B stock they are retaining.

I have a rule: don't touch shares without full voting rights with a bargepole.
Do nothing move or worse if they spend the cash in dividends.
$6.64 per share cash now on 4.15 B shares is $27.55 Billion
Converting 35 million MBLY shares to $1.5 Billion does not change INTC value as the MBLY share value is already inside INTC.
If they buy a new asset, it only replaces the MBLY value leaving INTC unchanged.
If they use the cash to pay dividends, then the value leaves the INTC stock.

An attempt to show MBLY value increase?
Bad news if it sells below current prices.
Mobileye needs to change their name to Mobileye AI and see their valuation double.
@Skezo or Mobile AI
Classification of intentions seems to be one of Mobileye's AI contributions, although they are not giving it away.

I've heard them state that they use the Habana Gaudi systems for training, so they're taking advantage of Intel's resources.

They will have to move from MIPS to RISC-V for future EYEQ chip designs. They have a long history working with STM for the design and mfg support and fab at TSM.

dbcoin profile picture
I always hoped they would distribute MBLY stock to INTC holders.
Re Pat: overhyped, hasn't done anything accept erode shareholder value.
Pretty normal activity for a parent when they spin off a subsidiary.
Money&Money,LLC profile picture
Pat is making the right moves. INTC will be back....Many counted out KO, XOM, PG before, and lost...
@Money&Money,LLC As a holder of INTC I hope you are right. Not all companies, "come back." KODAK comes to mind. Chip making is highly automated. Someone's chip. HUM, this is what they are doing, this is how they are doing it. How, can we do it better?
@SUE2 Don't confuse automated with cheap or easy though. I imagine this move was done to help with the capex of the new fabs.
Or they know they will be short for already reduced Div payment.
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