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INTC · Forward model · Intel Foundry · Bull case

What has to happen in Intel Foundry

Model as of

This page changes Intel Foundry inside the complete INTC model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

INTC forward model
Horizon
Consolidated fair value $77.13 all other verticals held in this portfolio case
Final-quarter revenue $11.46B 38% of company revenue
Explicit segment contribution $49.30B EBITDA less segment capex, before corporate items

Demand stays ahead of supply for longer than the base case assumes and Intel converts it. Management raised 2026 capital expenditure by roughly $3B and lifted tooling 40% because of demand signals, and says the constraint runs into 2027 - which means the 2026 Q2 ASP level is defended rather than competed away. Guidance of $15.8-16.8B already sits well above the $15.1B the street carried into the print. This case adds growth everywhere and more of it to DCAI and Intel Foundry, so external foundry revenue grows faster than internal wafer transfer and the eliminations ratio falls below the base case's terminal 0.90. Revenue reaches $114.1B across the four quarters to 2031 Q2 against $83.1B in the base case, and the exit multiple goes to 13x - and even then the case values Intel at $77.13, below the $88.24 price.

Intel Foundry

Basis quarter$5.76B
Final quarter$11.46B
Implied CAGR+15%
Final revenue mix38%

Process technology, manufacturing and advanced packaging. Roughly 95% of its $5,765M of 2026 Q2 revenue is internal wafer transfer to Intel Products, so it barely moves consolidated revenue - but it carries the whole capital programme, all of the depreciation and a $(2,089)M quarterly segment operating loss. The external business is real and tiny: $293M in the quarter, and mostly Altera moving from subsidiary to customer.

Last four quarters
2025 Q3 $4.24B Reported
2025 Q4 $4.51B Reported
2026 Q1 $5.42B Reported
2026 Q2 $5.76B Reported
Intersegment wafer, assembly/test and advanced packaging supply to Intel ProductsExternal foundry services
Sequential growth +2.0%/qtr decaying toward +1.8% +2.0% into 2026 Q3 on higher Intel 18A, Intel 3 and Intel 4 wafer volumes, which Intel says carry higher ASPs.
Intel Foundry

Latest: $11.46B (2031Q2E)

Period Value
2024Q1 $4.36B
2024Q2 $4.28B
2024Q3 $4.34B
2024Q4 $4.34B
2025Q1 $4.67B
2025Q2 $4.42B
2025Q3 $4.24B
2025Q4 $4.51B
2026Q1 $5.42B
2026Q2 $5.76B
2026Q3E $5.97B
2026Q4E $6.19B
2027Q1E $6.41B
2027Q2E $6.64B
2027Q3E $6.87B
2027Q4E $7.12B
2028Q1E $7.36B
2028Q2E $7.62B
2028Q3E $7.89B
2028Q4E $8.16B
2029Q1E $8.44B
2029Q2E $8.74B
2029Q3E $9.04B
2029Q4E $9.35B
2030Q1E $9.67B
2030Q2E $10.01B
2030Q3E $10.35B
2030Q4E $10.71B
2031Q1E $11.08B
2031Q2E $11.46B

Assumptions & reasoning

  • External foundry revenue is not modelled as its own vertical: Intel discloses it only from 2025 Q1 and does not break out 2025 Q3 or 2025 Q4, so four of the ten quarters would be gaps.
  • The 14.9% EBITDA margin is the disclosed (36)% segment operating margin with the whole of Intel's depreciation added back - $5,891M in 2026 H1, about $2,950M in the quarter - because substantially all of the depreciating manufacturing base sits in this segment.
  • The margin glides toward 50% - reaching 43% by 2031 Q2 - because depreciation grows with the capital programme while the segment operating margin improves only to the assumed (10)%; the cash cost of that capital is charged separately as a corporate programme, so nothing is double counted.
  • The 2026 Q2 loss improvement was charge relief, not operating leverage: $1.4B of lower period charges, against $340M of lower product profit from the higher-cost Intel 18A wafer mix.
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