TLDR
- Intel CEO Lip-Bu Tan announced the company will develop GPUs and hired former Qualcomm executive Eric Demmers as chief GPU architect
- Daiwa Capital Markets raised Intel’s price target to $50, joining other firms in upgrading targets, though consensus remains “Reduce”
- Intel shares jumped 2.7% to $50.11 on Tuesday following the GPU announcement and analyst upgrades
- The company beat Q4 estimates with $0.15 EPS versus $0.08 expected and $13.67 billion in revenue
- Intel’s 14A manufacturing technology is attracting customer interest with volume production expected later this year
Intel CEO Lip-Bu Tan dropped news on Tuesday that the chipmaker will enter the GPU market. He made the announcement at the Cisco AI Summit in San Francisco.
Tan revealed Intel hired Eric Demmers from Qualcomm to lead the GPU effort as chief architect. “I just hired the chief GPU architect, and he’s very good,” Tan said. “I’m very delighted he joined me.”
The move pushes Intel into direct competition with Nvidia in the GPU space. Demmers confirmed the job switch on LinkedIn last month after industry publication CRN first reported it.
Intel’s data center chip chief Kevork Kechichian will oversee the GPU development. “It’s tied in with the data center,” Tan explained. “We’re working with customers, and will then define what the customer needs.”
The GPU announcement came as Intel shares climbed 2.7% to $50.11. Trading volume reached 31.7 million shares on Tuesday.
Analyst Upgrades Boost Price Targets
Daiwa Capital Markets increased Intel’s price target from $41 to $50 in a Tuesday report. Other firms followed suit with upgrades.
HSBC jumped their rating from “reduce” to “hold” and lifted their target from $26 to $50. Benchmark raised their target from $50 to $57 with a “buy” rating.
Despite the upgrades, the Street’s consensus remains cautious. The average recommendation sits at “Reduce” with an average target price of $45.76.
Intel beat fourth quarter expectations on January 22nd. The company reported $0.15 earnings per share against the $0.08 estimate. Revenue hit $13.67 billion, topping the $13.37 billion forecast.
The stock has ranged from $17.67 to $54.60 over the past year. Intel currently carries a market cap of $250.28 billion.
Foundry Business Gains Traction
Tan said customer engagement is heating up for Intel’s foundry operation. “A couple of customers are engaging heavily” with the contract manufacturing business, he noted from the stage.
The interest centers on Intel’s 14A manufacturing technology. Volume production should ramp up later this year, according to Tan.
“In order to have a customer, they have to let us know what is the volume and which product,” he told Reuters. “So that we can plan and take time to build the capacity.”
Intel’s foundry talks reportedly include Apple as a potential customer. The company also announced a partnership with SoftBank’s Saimemory unit to develop AI-focused memory chips.
EVP David Zinsner bought 5,882 shares at $42.50 each on January 26th. The purchase totaled nearly $250,000 and increased his holdings by 2.44%.
Intel set first quarter 2026 guidance but analysts expect the company to post -$0.11 earnings per share for the full year. The chipmaker still reports negative net margins and negative return on equity.
Institutional investors own 64.53% of Intel’s stock. Several funds added positions in recent quarters, though the analyst community remains divided on the turnaround story.
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