Intel Corporation INTC is experiencing a downward slide in its stock price during after-hours trading on Tuesday, following the company’s disclosure of a new financial framework for its foundry business.
Financial Framework Unveiled
What Happened: Post-market closure on Tuesday, Intel revealed a revamped financial reporting structure aimed at enhancing cost control and boosting returns. The rationale behind this move is to foster transparency, accountability, and motivation within the organization.
The Birth of Intel Foundry
A novel operational segment christened Intel Foundry has emerged, encompassing foundry technology development, manufacturing operations, supply chain activities, and provision of foundry services. Commencing from the initial quarter of 2024, Intel will furnish segment outcomes aligned with key operational segments, including Client Computing Group, Data Center and AI, Network and Edge, Intel Foundry, Altera, Mobileye, and Others.
Financial Aspirations and Projections
Intel foresees the peak of foundry operating losses in 2024. The company aims to reach break-even operating margins between now and the conclusion of 2030 in the foundry sector. Notably, the anticipated total contract value with external clients in the Foundry division exceeds a formidable $15 billion.
In the words of Intel’s CFO, Dave Zinsner, “This model is tailored to unlock substantial cost efficiencies, operational streamlining, and asset valuation. Once it gains traction, we anticipate accelerating progress towards achieving our aspiration of 60% non-GAAP gross margins and 40% non-GAAP operating margins by 2030.”
Key Appointments and Investor Outreach
Moreover, Intel disclosed the selection of Lorenzo Flores as the CFO of Intel Foundry, with his tenure commencing on April 8. Flores boasts close to three decades of financial expertise in the semiconductor and tech realm, having recently held the position of CFO at Xilinx.
Intel will host an investor webinar at 4:30 pm ET to introduce its fresh financial framework for the Intel Foundry business.
Check This Out: Historic S&P 500 Rally In Q1 Flashes Bullish Signals For 2024: ‘Only The Ninth Time Since 1940’
Market Reaction on INTC Stocks
INTC Price Action: Intel shares witnessed a dip of 3.60% post-market at $42.39 at the time of reporting, as per Benzinga Pro.
Photo: Monticello/Shutterstock
