The companies on the Global 500 employ 70.2 million people, and their revenue represents more than one-third of the world’s GDP.

Fortune Global 500

With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

The 300 companies on this year’s list brought in over $12.5 trillion in revenue for the latest 12 months, with the median revenue figure at $24 billion.

America's Most Innovative Companies

This ranking evaluates how Fortune 500 companies are deploying AI, and how technology leaders value those investments relative to industry peers.

Fortune AIQ 50

The corporations on our annual list of the world's 500 largest companies combined to generate $41.7 trillion in revenue over the past year.

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

F500 2025-Intel

Intel is one of the largest semiconductor chip makers in the world. Founded in 1968, it designs, develops, manufactures, markets, and sells computing products and offers related services.

The 300 companies on this year’s list brought in over $12.6 trillion in revenue for the latest 12 months, with the median revenue figure at $22 billion.

The corporations on our annual list posted aggregate revenues of $41 trillion for the second year in a row.

Industries included in the sector are computers, internet services, IT services, semiconductors, and software companies.

Fortune Sector Leaders: Technology

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The 200 companies on this list are transforming industries from the inside out.

The corporations on our annual list of the world’s largest companies delivered a record $41 trillion in aggregate revenues.

The 300 companies on this list are transforming industries from the inside out.

Fortune collaborated with the Diligent Institute to rank the most innovative boards of directors among S&P 500.

Modern Board 2023-Intel

Intel made the 2023 list as a result of its age dispersion and board independence. But it’s weathered a stormy year with supply-chain snarls in the chip industry and <a href="https://fortune.com/2022/07/15/pc-prises-increasing-as-demand-falls-intel-chip-prices/">depressed demand</a> for personal computers. The company’s shares fell by about 35% from <a href="https://www.google.com/finance/quote/INTC:NASDAQ?sa=X&amp;ved=2ahUKEwiv_LyLiMH-AhU7kokEHYQrCKgQ3ecFegQIKBAa&amp;window=1Y">April</a> 2022 to 2023, and it reported a 32% dip in fourth-quarter earnings year over year. The chipmaker cut management pay in early 2023 as part of a turnaround plan—including a<a href="https://fortune.com/2023/02/01/intel-pay-cut-pat-gelsinger-samsung-amd-sk-hynix-q4-earnings/"> 25% cut</a> to CEO Pat Gelsinger’s base pay—and conducted layoffs as well. Intel has made several new board appointments over the past year, including Lip-Bu Tan, founding managing partner of Walden Catalyst Ventures; and Barbara Novick, cofounder of asset management firm BlackRock. It also tapped Frank Yeary, a managing member of private investment firm Darwin Capital Advisors and an existing member of Intel’s board, as its new chair. There are five women on Intel’s 12-person <a href="https://www.intc.com/board-and-governance/board-of-directors">board</a>.

Fortune Modern Board 25

See which workplaces made this year's list.

GPTW Manufacturing Production Large 2023-Intel

Employees say: 
 
"The work culture is more personal and idea-driven. We have open conversations, and I am not afraid of speaking my heart out. I believe each employee has a voice, and management encourages us to try new things."

Best Large Workplaces in Manufacturing and Production

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

F500-2023-062-Intel

Semiconductor manufacturer Intel took some knocks in 2022 amid slumping PC sales, but it remains on track to achieve its goals of opening new factories and churning out chips as advanced as those made by Taiwan-based TSMC. 
<ul> 
 	<li>In April 2023, Intel reported the largest quarterly loss in company history: $2.8 billion. After the first-quarter loss, Intel said that it would implement layoffs across the company to reduce costs.</li> 
 	<li>One bright spot was Intel-controlled Mobileye, maker of systems and software for self-driving cars, which boosted sales 16% in the first quarter of 2023.</li> 
 	<li>In late 2022 and early 2023, Intel launched next-generation processors including its fourth-gen Xeon Scalable processors, ramping up production to meet pent-up demand.</li> 
</ul>

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

Modern Boards 2022 Intel

The pioneering chip manufacturer earned the No. 4 spot because of its strengths in board independence and age dispersion.  
 
Despite up-and-down stock performance of late, Intel received a recent <a href="https://www.marketwatch.com/story/intel-is-on-a-long-and-expensive-road-but-stock-may-not-meaningfully-underperform-further-analyst-says-11645634423">upgrade from analysts</a> due to improved cash flow and long-term projects put in place by CEO Pat Gelsinger, who took on the role in February 2021. Gelsinger <a href="https://fortune.com/2021/12/02/intel-aims-to-vault-ahead-of-competition-during-chip-shortage/">has pledged</a> $250 billion over the next decade for capital expenditures, and Intel is opening two $10 billion fabrication plants in Arizona and another two $10 billion plants in Ohio. The CEO was <a href="https://www.cnbc.com/2022/03/02/why-intels-ceo-was-a-guest-at-bidens-state-of-the-union-address.html">acknowledged by President Biden</a> at the State of the Union address in 2022 for his plans to open a semiconductor hub near Columbus. 
 
Intel’s board has been chaired since January of 2020 by Omar Ishrak, a former chairman and CEO of Medtronic. 
 
The rest of the company’s <a href="https://www.intc.com/board-and-governance/board-of-directors">slate of directors</a> has a distinct academic flavor that is relatively rare for a corporate board. Andrea Goldsmith and Tsu-Jae King Liu are the deans of the engineering schools at Princeton University and UC Berkeley, respectively. Risa Lavizzo-Mourey is a former professor of public health at the University of Pennsylvania; she was previously CEO of the Robert Johnson foundation. Frank Yeary is the former vice chancellor at UC Berkeley, though he previously spent 25 years in finance, including an executive role at Citigroup; he is currently a managing member at Darwin Capital Advisors. 
 
CORRECTION: An earlier version of this story incorrectly identified Jim J. Goetz as the chair of Intel's board. Goetz is an independent director.

This year’s Fortune 500 marks the 68th running of the list.

F500 2022-Intel

Intel has had a challenging couple of years, as manufacturing and design problems have impaired its rollout of new chips. Its woes have contributed to the global semiconductor shortage, and Intel has been dethroned by Samsung as the world’s leading chipmaker by revenue. CEO Pat Gelsinger is hoping that expanding its production pipeline can restore Intel’s fortunes: The company has pledged $250 billion over the next decade for capital expenditures, and over the next few years it plans to open two new fabrication plants in Arizona and another two in Ohio, investing a total of $40 billion in those projects.

Total revenue for the world’s biggest companies fell 4.8% to $31.7 trillion this year—the first decline in half a decade.

G500 108 Intel

It’s been a rough year for the semiconductor giant, and unlike some other companies, Intel can’t put all the blame on COVID-19. In July 2020, Intel shocked the tech industry when it said it would delay a long-awaited upcoming 7-nanometer computer chip owing to manufacturing problems. The surprise postponement spooked investors, who were already worried that the company was lagging competitors like Taiwan Semiconductor Manufacturing Co. In early 2021, former VMware CEO Pat Gelsinger became Intel’s new top boss—a homecoming of sorts, since Gelsinger previously worked at the chipmaker for 30 years. Now, investors are hoping Gelsinger will be able to pull off a turnaround.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-40-Intel

For an astounding 13th straight year, Apple claims the top spot in Fortune’s annual ranking of corporate reputation, based on a survey of almost 3,800 executives, directors, and analysts.

World's Most Admired Companies

This year's Fortune Global 500 generated $33.3 trillion in revenues and $2.1 trillion in profits.

G500-2020-138-Intel

Intel’s big bet on artificial intelligence still hasn’t resulted in blockbuster sales. The semiconductor giant’s 2019 revenue increased 2% year-over-year, to $72 billion. Amid increased competition from the likes of Nvidia and AMD, Intel is doubling down on acquisitions to give it the A.I. technologies and expertise it seeks. Case in point: the $2 billion purchase of Israeli A.I. chip maker Habana Labs, announced in December.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-045-Intel

Here are the World's Most Admired Companies for 2019 as ranked in their industries. See who made the list.

This year's Fortune Global 500 generated $27.7 trillion in revenues and $1.5 trillion in profits.

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Change the World

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Here’s our look at 50 companies that do well by doing good.

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This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Nike, Cisco, MasterCard, SABMiller, Vodafone, Google—and 45 other companies that are doing well by doing good.

Google tops the list once again, marking its eighth appearance and fifth time as No. 1.

Fortune 100 Best Companies to Work For

Global business is back. After limping through a worldwide financial crisis and economic slowdown, the 500 largest companies ranked by revenues shattered all sorts of performance records in 2013: They racked up combined revenues of $31.1 trillion, up 2.5% from 2012, and profits soared 27% to nearly $2 trillion. China’s 95 companies (up from 89 last year) posted $5.8 trillion in revenues. The U.S. has four fewer companies on the list than last year but remains (for now) the country leader, with 128 corporations on the list—including No. 1 Wal-Mart Stores—reporting $8.6 trillion in revenues. 

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Intel is one of the largest semiconductor chip makers in the world. Founded in 1968, it designs, develops, manufactures, markets, and sells computing and related products and services.

Q2 2026

Q1 2026

Q4 2025

Q3 2025

Q2 2025

Q1 2025

Q4 2024

Intel (INTC): Company Profile, Stock Price, News, Rankings

legacy

Intel

intel

for standing by, and welcome to the Intel Corporation's First Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, John Pitzer, Corporate Vice President, Investor Relations.

Thank you, Jonathan, and good afternoon to everyone joining us today. By now, you should have received a copy of the Q1 earnings release and earnings presentation, both of which are available on our Investor Relations website, intc.com. For those joining us online today, the earnings presentation is also available in our webcast window. I'm joined today by our CEO, Lip Bu Tan and our CFO, David Tinsner. Lip Bu will open with comments on our first quarter results, as well as some initial observations, priorities, and actions that he is driving.

Dave will then discuss our overall financial results, including second quarter guidance. We will then transition to answer your questions. Before we begin, please note that today's discussion contains forward looking statements based on the environment as we currently see it, and as such are subject to various risks and uncertainties. It also contains references to non GAAP financial measures that we believe provide useful information to our investors. Our earnings release and most recent annual report on Form 10 ks and other filings with the SEC provide more information on specific risk factors that could cause actual results to differ materially from our expectations.

They also provide additional information on our non GAAP financial measures, including reconciliations where appropriate to our corresponding GAAP financial measures. With that, let me turn things over to Lip Bu.

Thank you, John. And let me add my welcome. I joined Intel five weeks ago. The reason I'm here is simple. I love our company.

I saw the challenges we were facing, and I could not sit on the sidelines knowing I had the opportunity to turn things around and put us back on the path to gain market share and drive sustainable growth. Q1 was a step in the right direction, driven by Dave and Michelle's leadership. We delivered revenue, gross margins, EPS above our guidance. I want to thank them both, as well as our teams for the good execution, especially with the ongoing macroeconomic uncertainty. Our goal now is to build on this progress, but it won't be easy.

There are many areas we need to improve and there's no quick fixes. We must remain laser focused on execution. One of my biggest learning so far is that we need to fundamentally transform our culture and the way in which we operate. Organizational complexity and bureaucracies have been suffocating the innovation and agility we need to win. It takes too long for decisions to get made.

New ideas and people who generate them have not been given the room or resources to incubate and grow. The unnecessary silos have led to bad execution. I'm here to fix this. I'm taking shift actions to simplify the way we do business and drive transparency and accountability across the company. We will empower smaller teams to move faster and make better decisions.

And we will significantly reduce the number of layers that get in their way. As a first step, I have flattened the structure of my leadership team. All critical product, manufacturing, and G and A functions, which were spread over two to three layers, are now directly reporting to me. This will allow me to get closer to our product and engineering groups and work directly with them to close the gaps with competition more quickly. I will apply the same streamlining approach across the company with a focus on empowering our engineering talents to create great products and make it easier for our customer to do business with us.

To accelerate this simplification, we are taking more costs out of the business, the lower our calendar 2025 and calendar 2026 OpEx targets. We now expect OpEx of $17,000,000,000 this year and $16,000,000,000 next year. In addition, as we continue to identify ways to operate our manufacturing network more efficiently. I have directed our teams to find additional $2,000,000,000 of savings in our gross CapEx, taking our target for this year to $18,000,000,000 We will continue to take closer look at our existing factory footprint to ensure that we are making the most efficient use of our installed capacity before committing to any additional spending. I will continue to make the needed investment to reignite innovation, even as we reduce our overall expenses by minimizing projects and programs that have been taking attention away from our core client and server business.

They will include revitalizing our engineering core and rebuilding our engineering talent pool with urgency by promoting strong leaders internally, bringing back critical loss talent, and recruiting new people. In addition, we are mandating a four day per week return to office policy, effective Q3 twenty twenty five. I know firsthand the power of teamwork, and this action is necessary to reinstill a more collaborative working environment, improving efficiency and boost innovation. By eliminating inefficiencies and transforming how we do business, I strongly believe we can reduce our costs while securing our future. Many of you have asked about my longer term strategic plan.

It is appropriate question. It's a little bit too soon for me to provide all the details, but let me share with you my priorities. First, the best products always win. And this is very important that we refocus our core franchise to start building best in class products again. We have a good foundation.

Our ecosystem in client and data center computing is valuable and durable. And we still maintain a large market share in both. My focus will be ensuring that our team build products that are highly competitive and meet the needs of our customer as we enter a new era of computing defined by AI agents and reasoning models. To achieve this, we are taking a holistic approach to redefine our portfolio to optimize our products for new and emerging AI workloads. We are making necessary adjustments to our product roadmap so that we are positioned to make the best in class products while staying laser focused on execution and ensuring on time delivery.

However, I want to emphasize that this is not a quick fix here. These changes will take time. Our goal is to become the platform of choice for our customers. This requires us to radically evolve our design and engineering mindset and anticipate the needs of our customer well in advance. I have received direct feedback from many of our largest customers who are also close personal friends.

I'm taking this feedback to heart and using it to inform and change our approach to product and platform design. Second, we need to refine our AI strategy with a focus of emerging areas of interest. My experience helping successfully fund and incubate many startups in this space provides unique insights that we will leverage in this front. Our goal will be to take an integrated system and platform view to develop full stack AI solution that enable more accuracy, power efficiency, and security for our enterprise customers. Our goal will be to enable the next wave of computing defined by reasoning models, agentic AI and physical AI.

Third, we need to build trust with foundry customers. We have a lot of important building blocks in place, including the realm of Intel 18A in second half of twenty twenty five to support the launch of our first Pentagon Lake SKU by year end, with additional SKUs coming in the first half of twenty twenty six. However, I know from my years at Cadence Design that success in foundry business requires more than process technology, manufacturing capabilities alone. It is first and foremost a customer service business, built on foundational principle of trust. And we need to instill customer service mindset across our foundry business.

Success in foundry relies on recognizing that each customer use different design tools, methodologies, and styles. As a foundry, we need to ensure that our process technologies can be easily used by a variety of customers, each with a unique way of building their products. To do this, we are more rapidly embracing industry standard EDA tools and best design practices. Here again, there's no quick fix, but we will make the necessary changes to our roadmap to deliver on the commitments we make to our foundry customers. We must learn to delight our customers by building wafers that meet their required power, performance area, cost, quality, yield, reliability, and on time schedule.

While we are currently focused on delivering Intel 18A, we are also working closely with customers to define the critical KPIs to ensure online delivery of Intel 14A. Lastly, we need to strengthen our balance sheet. Our business is capital intensive, and we have important investment to make at the time when our financial performance is not where it needs to be. This means we need to be prudent with capital. In addition to new targets of OpEx, CapEx, we will also look to further monetize non core assets.

I'm very pleased to have Silver Lake as an investor in Altera and welcome on board Rakib to help drive the business to its potential. In addition, we have made the decision not to spin off Intel Capital, but to work with the team to monetize our existing portfolio, while being more selective on new investments that are supported strategy. We need to get our balance sheet healthy and start the process of deleveraging this year. As we are building the new Intel, you can expect us to stay humble, drive the necessary changes to delight our customers. My motto has always been to under promise and over deliver, and I will be not satisfied until we regain the trust of our customers, putting the company on sustainable path of gaining shares and growing revenue and deliver consistent returns for our shareholders.

Thank you Lip Bu. Our Q1 results mostly reflected our view entering the year that our two biggest markets were poised for growth. On the client side, the end of service for Windows 10, the expected growing adoption of AIPCs, and an aging installed base following the COVID era refresh pointed to a PC TAM growing three to 5%. Similarly, on the traditional server side, delayed infrastructure upgrades driven by the rapid adoption of AI servers in 2024 supported double digit CPU core growth this year on a roughly flat units. More recently, the economic landscape has become increasingly uncertain driven by shifting trade policies, persistent inflation, and increased regulatory risk.

While we have yet to see a meaningful change in customer buying patterns, we think it prudent to manage the business with a level of conservatism going into the second half of the year. First quarter revenue was $12,700,000,000 coming in at the high end of our guidance range driven by better than expected Xeon sales. Similar to Q4 twenty twenty four, we believe Q1 revenue benefited from customer purchasing behavior in anticipation of potential tariffs, though it is difficult to quantify the magnitude. Non GAAP gross margin was 39.2%, approximately three percentage points above our guidance on much stronger than expected demand for Raptor Lake combined with improved cost for Meteor Lake. While we continue to see the mix of AIPCs growing throughout the year, the rate of growth off a lower than expected Q1 will be lower.

We delivered first quarter earnings per share of 13¢ versus our guidance of breakeven EPS driven by higher revenue, stronger gross margin, and lower operating expenses. I was particularly pleased to see our spending down $400,000,000 sequentially and $700,000,000 year over year as we continue to focus on optimizing our cost structure. Q1 operating cash flow was 800,000,000 We had growth CapEx of $6,200,000,000 with offsets of $1,700,000,000 in the quarter resulting in an adjusted free cash flow of negative $3,700,000,000 We ended the quarter with a cash balance of $21,000,000,000 and received $1,100,000,000 from CHIPS grants and $1,900,000,000 for the final close of our NAN business sale to SK INIX. Moving to segment results for Q1, as previewed on our Q4 twenty four earnings, we updated our segment reporting for Q1 twenty twenty five. Details can be found in the appendix to our earnings deck and in our q one twenty five ten q.

The following commentary reflects the updated segmentation and accompanying recasted 2024 financials. Intel products revenue was $11,800,000,000, down 10% sequentially but above our expectations. CCG revenue was down 13% quarter over quarter below typical seasonality and in line with our expectation with higher than expected volumes offset by product mix and competitive pressure. DCAI revenue was down 5% sequentially and above expectations driven by hyperscaler demand for host CPUs for AI servers and storage compute. Operating profit for Intel products was $2,900,000,000, 20 5 percent of revenue and down $632,000,000 quarter over quarter on lower revenue partially offset by reduced operating expenses.

Intel Foundry delivered revenue of $4,700,000,000 up 8% sequentially on pull ins of Intel seven wafers and increased advanced packaging services. Intel foundry operating loss in q one was $2,300,000,000, roughly flat quarter over quarter and in line with expectations. Structural cost improvements were offset by startup costs associated with the ramp of products on Intel eighteen a. Turning to all other, revenue came in at $943,000,000 and was down 15% sequentially, slightly above expectations. The three primary components of all other are Mobileye, Altera, and IMS.

Collectively, the category delivered $103,000,000 of operating profit. As Lip Bu stated, we announced on April 14 our intention to sell 51% of Altera to Silver Lake Partners for an almost $9,000,000,000 valuation with Intel receiving net cash proceeds of $4,400,000,000. We believe the value of our remaining 49% stake in Altera will grow over time through our partnership with Silver Lake and with the addition of Raghav Hussein as the CEO. We expect this deal to close in the second half of twenty twenty five, at which point we expect to deconsolidate Altera from our financial results. Now turning to guidance.

Historically, average sequential growth in q two has been roughly flat with q one. However, the very fluid trade policies in The US and beyond, as well as regulatory risks have increased the chance of an economic slowdown with the probability of a recession growing. This makes it more difficult to forecast how we will perform for the quarter and for the year even as the underlying fundamentals supporting growth I discussed earlier remain intact. While we have offsets including a global, highly diversified manufacturing footprint to help mitigate tariffs, we will certainly see costs increase and we feel it prudent to anticipate a TAM contraction. The biggest risk we see is the impact of a potential pullback in investment and spending as businesses and consumers react to higher costs and the uncertain economic backdrop.

As a result, we're forecasting a wider than normal Q2 revenue range of 11.2 to $12,400,000,000 down two to 12% sequentially. Within Intel products, we expect DCAI to decline at a faster rate than CCG. We expect Intel foundry revenue down quarter over quarter due to pull ins to q one, lower wafer and advanced packaging volume, and capacity constraints in Intel seven which we expect to persist for the foreseeable future. For all other, we expect revenue for the sum of those parts to be roughly flat sequentially. At the midpoint of 11,800,000,000 we expect gross margin of approximately 36.5% on lower revenue and mix to our outsourced and lower margin client products with a tax rate of 12% and breakeven EPS all on a non GAAP basis.

As you think about the full year, we recommend you start by using the last ten year seasonality to model sequential changes in revenue, but be mindful of the significant uncertainty in markets today, especially due to the potential for meaningful tariffs and tight supply on our older nodes. We expect non controlled income or NCI to net to zero in Q2 and for the full year to be approximately $500,000,000 on a GAAP basis. NCI is still expected to grow in fiscal year twenty twenty six to an updated range of $1.3 to 1,500,000,000.0 on a GAAP basis and meaningfully increase further in future years. As Lip Bu discussed earlier, we're simplifying our organizational structure and the way we work across intel so that we innovate faster and adapt more quickly where needed to better serve our customers. As a result, we now expect 2025 OpEx of $17,000,000,000, 5 hundred million dollars lower than prior expectations with a 2026 OpEx target of $16,000,000,000 We are likely to have restructuring charges associated with these actions, some of which may be included in our non GAAP results.

Since we have not yet estimated these charges, they are not included in our guidance. These spending reductions will be driven by numerous broad based transformation activities. Key 2025 focus areas will be refocusing our portfolio, eliminating organizational complexity, transforming our engineering functions, and continuing to drive to leading SG and A efficiency. As Lip Bu stated, we anticipate our 2025 gross capital investment will now be approximately $18,000,000,000 which is below our previous guide of $20,000,000,000 reflecting further operational efficiencies and better utilization of our construction in progress. While gross CapEx is down, we maintain our range for 2025 net CapEx to be approximately 8,000,000,000 to $11,000,000,000 due to uncertainty regarding timing of the US government fulfilling their obligations in our CHIPS agreement.

Beginning the process of delevering our balance sheet in 2025 remains a top priority for us as evidenced by our lower OpEx and CapEx targets and the value unlock across our non core assets. I'll wrap up by saying that Q1 was a solid quarter to start even as the rest of the year is more uncertain. We will closely manage what's in our control and react quickly as the environment evolves. I'm encouraged by Lip Bu's leadership and focus on enhancing our competitive position, improving our balance sheet and setting us on a path to deliver consistent returns to our shareholders. With that, let me turn the call back over to John to begin the Q and A.

Thank you, Dave. We will now transition to the Q and A portion of our call. Michelle Johnston Holdhaus, CEO of Intel Products will be joining Lip Bu and Dave during the Q and A session. As a reminder, we would ask that each of you ask one question and a brief follow-up question where applicable. With that, Jonathan, can we take the first question please?

Certainly. And our first question comes from the line of Ross Seymore from Deutsche Bank. Your question please.

Hi guys, thanks for letting me ask a question. Lip welcome to Intel. Lip Bu, the first question is for you. You talked a lot about increasing the flexibility and speed at Intel and unfortunately having to shrink the headcount to do so. How do we balance fixing the roadmap with also filling the foundry and making sure you have the unit volumes there?

It seems like the flexibility and speed goals would be more quickly adopted and capitalized by going to Foundry, but you have the need to fill your own Intel Foundry. So balancing the internal product roadmap versus the Foundry side of things is basically the question.

Ross, thank you so much for the questions. So a couple of things. One is clearly the approach is basically to flatten the organization, number of layers, and so that we can really focus on the right products and then deliver the customer the solution. And then in terms of the product and the roadmap, I think it clearly we like to focus on what is the killing product that we want to have and then laser focus on make sure that we deliver on time on the performance and then the power that make sure that we meet the customer requirement. And then in terms of the foundry, clearly 18A is very important for us, for Penta Lake.

Secondly, I think we clearly one by one, improving the yield, the reliability, and so that our internal customer can use of that. I think from the product side, they have to do the best they can, and it'll depend on whether it's inside or outside, and then drive the performance of the products.

Yeah, did have one for Dave. Dave, on the gross margin side of things, you talked a little bit about the slope for the rest of the year, but especially given the strategic changes that Lip Bu is putting into place, the cost cutting and the OpEx side of things and the lower CapEx that you talked about. Can you just talk about some of the puts and takes on gross margin if you think about 2025 as a whole and maybe even 2026? What are some of the goals that you have?

Yeah, sure, Ross. And I'll qualify this by saying, it's a relatively dynamic industry out there right now, given the tariffs and the implications on what that might look like from our TAM and from the macro. So I'm saying this with some murkiness as it relates to the full year picture. I would just say that when we look out through the year, we do expect to see our mix on the client side move more to the Lunar Lake and so forth. And as you know, Lunar Lake's margins are more under pressure given the memories and package, and so that makes the accounting make it look a little funky.

So that will be a headwind to our margins on a go forward basis. And in addition, when we look at AT and A, we're going to be ramping that through the year, and their startup costs associated with that bringing that up in Arizona. That's always going to put some pressure on gross margins through the year as well. I think as you get into '26, things start to go the other direction. Panther Lake will be ramping more in volume next year.

It's a better margin product than Lunar Lake just on an apples to apples basis. But on top of that, as you know, have 18A on Panther Lake, so it brings the wafers back into the fabs and we get the margin stacking benefit of that on a consolidated basis. So we'd expect next year to look better. Of course, all of that is subject ultimately a lot of what is reflected in the margins is how we do on the top line side. And so we've got to sort through how tariffs impact us.

I think from a tariff perspective, this year could be choppy depending on what ultimately is settled across The US and abroad. But we do have a global supply chain. So we do have the ability to flex to mitigate a lot of the headwinds we face. It's just we can't obviously turn this stuff on a dime. It's going to take us time to optimize the network to what the rules are in terms of tariffs.

Thanks, Russ. Jonathan, can we have the next question please?

Certainly and our next question comes from the line of Timothy Arcuri from UBS. Your question please.

you help us just also on gross margin? Can you help us with sort of what a clean number is for March? You guided 36, but that was supposed to have some COGS headwinds from the way you accounted for the grants, but it came in at 39. So sort of what's the clean number for March? Then also you said that the Q1 number would be the trough.

So I know you're guiding Q2 to 36, five, but like is could it go lower than what you're guiding?

Yeah, I mean obviously we thought Q1 would be a trough and it turned out to be better, so that put some pressure on 2Q now on a relative basis. And like I said, the tariff dynamics do kind of change outlook through the year, so that's an additional pressure point for gross margins through the year. In terms of the margins for Q1, kind of cleaning that out, mean clearly the biggest benefit to the gross margins was the beat on the top line, kind of handedly beat top line that helped out a lot. In addition, we did better or we had more of our volume come from Raptor Lake versus Lunar Lake and so that was mix beneficial to gross margins. And then we did, I think a little bit better job in terms of just managing spending and so forth that helped out.

But the two bigger components were the higher revenue in Raptor Lake. Think if you strip those two things out, we were we would have been much closer to the guide.

I do. Yeah. So, Lip Bu, I know the prior policy had been to not announce new, you know, third party foundry customers. How how how do you think about that? And how can you update us on sort of where you're tracking?

Is there anything to help us believe that maybe you can add a Tier one customer and maybe this year, if not sooner, I know that they want some power improvements on AT and A, but can you kind of

Sure. Thanks, Tim. I think the priority one for us is for Intel Foundry is ramping our internal customer, like the Pentelic I mentioned earlier.

And then the next step is basically build the trust with our Foundry customer and the PDK, the schedule, to really make sure that we're really robust on that. And then in terms of the process technology, the priority is really focused on yield, reliability. And also I think it's very important to understanding this is a customer service mindset so that every customer has different design tool, methodology, style. We want to make sure that we really do the pattern matching so that we really optimize for their solution they want to drive. So I think it's kind of a one, two step.

And then we really continue to drive the efficiency so that we can really scale the business.

Thank you, Tim. Jonathan, can we have the next question, please?

Certainly. And our next question comes from the line of Joe Moore from Morgan Stanley. Your question, please.

Great. Thank you. So a number of elements in your letter and in your comments about kind of improving product execution. I guess five weeks into it, can you give us your assessment of Panther Lake and Clearwater Forest in the 1885 portfolio and give us a sense of are those leadership products? Do you still have work to do to get to the leadership position that you want to have?

Yeah, let me start. I think Michelle will chip in. First of all, I think clearly our laser focus on execution and in terms of deliver on time, performance that we can meet the customer and industry trends and the workload. So that is number one priority for us. In terms of Penta Lake, clearly on the 18A is very important.

We have the first SKU by the end of this year, then we have additional SKU the next year. So I think so far we are very focused on that. Michelle?

Yeah, maybe just to add, Joe, I think I talked about this a little bit in our Q4 earnings. Panther Lake really matches what you see in both Meteor Lake and Lunar Lake in the way that we're going to ramp, bringing our first most performant product out first with customers and then the additional SKUs in Q1, which really allows us to line up with the commercial marketplace. That product looks quite good competitively, and we get a lot of customer interest. So I think we continue to track well there. You also asked about Clearwater Forest, and I talked a bit about that and the prioritization between Panther Lake and Clearwater Forest in Q4 as well.

And so for Clearwater Forest, it has some very unique packaging that comes to market with it. And therefore, we decided to prioritize getting Panther Lake out first. And then in the first half of twenty twenty six, you'll see Clearwater Forest. I would just remind you that Clearwater Forest is an e core based product. So it's a derivative of Granite Rapids.

And so it'll be more of a purpose built product than your kind of leading performance part in the marketplace. But both are on track for delivery.

I do. Thank you for that. The comment that you guys made about seven nanometer being constrained for the I'm sorry, Intel seven being constrained for the foreseeable future, can you elaborate on why that is and what impact that might have?

Pretty simply, we're doing better on Raptor Lake and Raptor Lake's and Intel seven part, and so we obviously plan out our network to be just to the edge in terms of capacity, and when things shift meaningfully like they did, we're going to be hand them out. That said, that's usually a good thing for the factory, when they're constrained they leverage the network to try to produce more wafers and every wafer becomes less expensive as a result, so we obviously do like that. Ultimately though, we do want to see these AIPC products gain more traction in the market, and we're optimistic that happens in the year.

Yeah. Maybe just to add on both seven and ten nanometer. Obviously, the macroeconomic concerns that we see and just with the overall economy, we are particularly seeing consumer, a stronger n minus one and n minus two demand in the marketplace as those system price points tend to stay rather fixed. And so we've been doing our best to respond to that shift, while at the same time in the commercial segment, we are seeing that Windows 10 refresh and a strong demand for AIPC. I think there's both good and bad news in that, and that as you see n minus one, n minus two, as Dave talked about, you see a lot of that gross margin flow to the bottom line.

It is also, as the AIPC ramp slows, that's also good for gross margins. But I do want you to walk away with the fact that we continue to invest in the AIPC. We do view this as the long term growth segment. We have our AI symposium with all the software vendors this week, and we see a ton of excitement from our customers around Lunar Lake. And so we'll be balancing our portfolio and our mix across our foundries.

Thanks, Joe. Jonathan, can we have the next question, please?

Certainly. And our next question comes from the line of C. J. Muse from Cantor Fitzgerald. Your question, please.

Thank you for taking the question. I guess first question for Lip Bu. You touched on your AI strategy focusing on new and emerging workloads like reasoning models, agentic AI and physical AI. Is the plan here to reinvent x86 to succeed in the AI world or perhaps a broader portfolio, including ARM? And then should we be interpreting your focus more on edge AI?

Yeah, good question, CJ. I think first of all, as I articulated on the AI strategy, it's very important to understanding the workload and the mission that we can really deliver. And then clearly, we're going to look for partnership with the industry leader to build a purpose built silicon and a software to optimize for that platform. So we like to be the compute platform for doing that. And clearly, think one of the big area will be the kind of edge and inference area.

And that will be important to have the architecture that are low power and drive efficiency. And so those kind of things that we are exploring some of this new architecture and some of this disruptive platform that we try to build. So stay tuned. Over time, we're going to start to articulate the strategy for that.

I do, Jed. Thanks. Dave, to follow-up on the OpEx guide for 'twenty five and 'twenty six, Do those numbers fully contemplate the headcount reductions that you are planning or over time? Could we see additional savings?

Intel (INTC) Q1 2025 Earnings Call Transcript

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