Could Intel Stock Help You Become a Millionaire?
Intel (NASDAQ: INTC) was once considered a stable long-term investment on the semiconductor market. But over the past 10 years, the chipmaker’s stock declined 26%. Even with reinvested dividends, it delivered a negative total return of 4%.
During the same period, the S&P 500 rallied 192% and generated a total return of 250%. AMD‘s (NASDAQ: AMD) stock soared a whopping 5,220%. Let’s see why Intel’s stock withered — and if it has the potential to bounce back and generate millionaire-making gains in the future.
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Intel is still the world’s largest producer of x86 central processing units (CPUs) for PCs and servers. But according to PassMark Software, Intel’s share of the x86 CPU market shrank from 82.2% to 61% between the fourth quarters of 2016 and 2024. AMD’s share doubled from 17.8% to 35.7%.
Intel ceded the market to AMD as it grappled with production delays, chip shortages, and shifting strategies under three different CEOs. Intel manufactures most of its chips at its first-party foundries, but AMD outsources all of its production to third-party foundries like TSMC and Samsung.
Over the past few years, Intel fell behind TSMC and Samsung in the “process race” to manufacture smaller, denser, and more power-efficient chips. Intel’s problems started with a difficult transition from 14nm to 10nm chips (2017-2020), then worsened with even more delays in its subsequent transition to 7nm chips (2020-2023). As Intel tripped over its own feet, AMD developed a new generation of Ryzen CPUs for PCs and Epyc CPUs for servers. TSMC pumped out those chips on schedule, and many of Intel’s longtime customers started to pivot toward AMD’s chips instead.
Intel also failed to gain a foothold in the mobile chip market, and its CPUs became less relevant than Nvidia‘s graphics processing units (GPUs) in the booming AI market. Missing those two key technological shifts indicated Intel had lost its edge in the chipmaking market.
Pat Gelsinger, who became Intel’s CEO in 2021, initially dismissed the idea that it needed to follow AMD’s lead, divest its foundries, and become a “fabless” chipmaker. Instead, Gelsinger doubled down on expanding Intel’s foundries, chased government subsidies, and claimed it could catch TSMC by 2025.
But at the same time, Intel quietly outsourced some of its production to TSMC to alleviate the pressure on its first-party foundries. Even with that assistance, Intel struggled to ramp up its production of its newest Meteor Lake chips over the past year as development of new AI-driven CPUs compressed its gross margins.
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