Intel’s foundry pivot: from money pit to maybe‑business

A few years ago, Intel’s manufacturing overhaul looked like a cautionary tale: slipping process leadership, collapsing margins and a foundry plan that burned billions in capex while external revenue barely moved the needle. Today the picture is more complicated – and more interesting. Intel Foundry Services has been carved out as a standalone “systems foundry” with close to 18 billion dollars of internal and external sales, a backlog north of 15 billion and a roster of early customers that now includes big AI and cloud names alongside Intel’s own product teams.

The turnaround, however, is only half‑built. The foundry unit still runs deep in the red, with annual operating losses measured in multiple billions as Intel ramps EUV nodes like 18A and pours more than 100 billion dollars into fabs in the U.S. and Europe, and management is targeting roughly 40% gross margins and break‑even by around 2027 - a goal that assumes new capacity can be filled quickly enough with meaningful external…