Intel (INTC) shares were poised for another active session on Friday, climbing as much as 3.2% in premarket trading alongside a broader rally in semiconductor stocks. The gains came as Nasdaq 100 futures advanced 0.5%, reflecting renewed investor appetite for tech names after a turbulent week.
The stock closed Thursday at $118.50, according to Yahoo Finance, following a volatile session that saw shares recover from a five-day losing streak. On Wednesday, Intel surged 7.4%, snapping the slide and extending a rebound that has drawn attention to the chipmaker's strategic pivot.
Foundry Ambitions and Apple Speculation
At the heart of Intel's recent rally is the company's push into contract chip manufacturing, known as foundry services. Reports from Reuters and the Wall Street Journal this month indicated that Intel has a preliminary agreement to manufacture chips for Apple devices. While details remain sparse—including which chips will be made, the process node, and shipment volumes—the potential deal has fueled optimism that Intel could become a serious competitor to Taiwan Semiconductor Manufacturing Co. (TSM), the dominant foundry player.
Intel's foundry strategy is seen as critical to its turnaround, especially as demand for AI-related infrastructure surges. CEO Lip-Bu Tan said in April that the "next wave of AI" is driving demand for Intel CPUs and its wafer and packaging products. CFO David Zinsner emphasized "disciplined execution" and improved supply as key to the company's outlook.
Mixed Financial Picture
Intel's first-quarter results offered a mixed view. Revenue rose 7% year over year to $13.6 billion, but the company posted a GAAP net loss of $3.7 billion. For the second quarter, Intel expects revenue between $13.8 billion and $14.8 billion. The numbers have left investors debating whether the rally reflects genuine business transformation or simply a wave of momentum behind AI-related stocks.
Analyst targets have been rising. Benjamin Reitzes at Melius Research raised his Intel price target to $150 from $100, maintaining a buy rating. Benchmark's Cody Acree also increased his target to $140 from $105, according to StockAnalysis. These upgrades have added fuel to the stock's recent gains.
Broader Market Context
Friday's premarket strength was supported by a pullback in Treasury yields, which boosted growth stocks and large-cap tech names. Investors also kept an eye on geopolitical developments, including U.S.-Iran talks and oil supply risks. "Geopolitical risk has become less immediately damaging for sentiment," said Naeem Aslam, chief investment officer at Zaye Capital Markets, to Reuters, though he cautioned that the risk had not disappeared.
U.S. markets are scheduled to close Monday for Memorial Day, adding a layer of caution as traders position ahead of the long weekend.
Challenges and Road Ahead
Despite the optimism, significant hurdles remain. J.P. Morgan analyst Harlan Sur suggested it will take at least 12 to 18 months before investors can assess Intel's foundry progress, and at least five years to determine if the unit will be profitable. "No company in history has ever fallen off the Moore's law curve and made it back on," noted SemiAnalysis President Doug O'Loughlin, highlighting the technical challenges Intel faces in catching up with TSMC.
For the stock to sustain its upward trajectory, investors will need to see evidence of steady AI server CPU orders, meaningful foundry contracts from major clients, and continued buying interest ahead of the holiday weekend. Until then, the rally remains a story of potential—with the details still thin.
