Intel's shares are currently experiencing a downturn.
Intel's shares are taking a dive today, dropping 4.1% as of 12:20 p.m. ET. The tech giant wasn't immune to the broader market slump, with the S&P 500 and Nasdaq Composite also seeing decreases of 0.8% and 1.4%, respectively.
The downturn in Intel's stock price can be attributed to escalating trade tensions and news about a potential deal between the company and Taiwan Semiconductor that seems less likely to materialize. The latter, which has been eyeing a transformation in the AI market, has been linked to numerous potential deals. A deal involving Intel's manufacturing arm being overseen by Taiwan Semiconductor, the world's leading fabricator, has gained attention.
However, Taiwan's economy minister reportedly has no knowledge of such a deal and stated that TSMC would need approval to move forward. This uncertainty about the potential deal's legitimacy prompted shares to dip.
Moreover, the Trump administration reaffirmed its intent to further restrict chip exports to China, posing a significant threat to Intel, which made over $15 billion in sales there last year. Any substantial decrease in revenue from the Chinese market could worsen an already challenging situation for Intel.
The rumored partnership between Intel and Taiwan Semiconductor has given Intel's stock a significant boost in recent weeks. In just one week, its stock soared by 23.6%, marking its largest weekly gain since January 2000. Despite this optimism, analysts remain skeptical about the deal's chances of success due to regulatory hurdles and concerns about foreign ownership of U.S. factories.
[1] Source: "Intel's planned sale of chip factory to TSMC sparks concern over technology supply chain security" - Reuters[2] Source: "Intel's stock price surges as a deal with TSMC seems increasingly likely" - The Verge[3] Source: "Broadcom Wants to Split Intel in Half, Buying its Design Business" - Bloomberg[4] Source: "Will a possible Intel-TSMC deal rescue the chips giant?" - PCWorld[5] Source: "Intel’s sharp stock rise as Big Tech faces biggest upheaval ever" - The Guardian
- Despite recently struggling with its finance and investing prospects, Intel received a boost from rumors of a potential partnership with Taiwan Semiconductor.
- The uncertainty surrounding the deal between Intel and the Taiwanese semiconductor giant has led investors to reevaluate their shares in the American tech company.
- If the alleged investment in Intel's manufacturing arm by Taiwan Semiconductor were to materialize, it could provide a much-needed income boost for the company, which has previously relied heavily on its sales in China.
- The potential impact of trade tensions and regulatory hurdles on the Intel-Taiwan Semiconductor deal has left some investors questioning whether these shares are worth their investment money.
