I bet the fabs would be cheaper to build, if Intel didn't give their government handouts (chips act) to their shareholders. "Here's a blank check for $76,000,000,000. Go spend it on anything you want, no strings attached. Oh, and here's the loophole in the law we put in specifically, because you offered money to us".
If the Gov is silly enough to give a public company with share holders and an expectation of profit a blank check with no strings, that's what they get.
No, I don't think you understand. This is not "You get what you deserve, because gov is too dumb". This is what is called "legalized bribery and corruption".
You must have done very poorly in law school, or perhaps are too simple to understand that all companies make lawful donations to politicians to get benefits in return.
Do you think that Intel is the only company make donations or reap such rewards? lol
you really dont understand. USA lost their technological edge and government is trying to catch up. problem is they are bunch of idiots, old people that read news instead of looking for new trends . finally they finance mature industries
Spend the past decade+ investing in stock buybacks instead of r&d and get rewarded by the gov't with more money to give the stockholders. Future looking bright for Intel.
They’re like a normal company that has to reward investors. Coca Cola pays out dividends too. There’s nothing wrong with it. Dividends are a necessary part of corporate finance. Otherwise Intel wouldn’t exactly be interesting to own for investors who want a more reliable return. That’s capitalism, get over it. You don’t seem to understand much about that bill. “Companies are prohibited from using awarded funds through the CHIPS program for stock buybacks or payment of dividends. The expansion clawback in the bill requires the recipients of federal financial assistance not to engage in certain material expansions of semiconductor manufacturing in countries of concern.”
A big part of why Intel is doing this is because their fab roadmap has been a mess for almost 10 years and they need help to stay competitive in the current market and it’s taken years gor them to realize their old paradigm can’t survive.
If you believe that, I have a bridge i'd like to sell you. As if paying for their fab capex doesn't allow them to distribute more cash via buybacks.
I'm not talking about dividends. Buybacks, which were illegal until the 80's, boost the stock price, allow investors to defer/reduce taxes and get CEOs fat bonuses. Intel is in no way unique, Apple, Cisco, Boeing, etc. all do the same thing, and it's BS.
Intel does not need help to stay competitive. They need to invest in r&d and fabs instead of artificially boosting their stock price.
You do realize it’s a bit more complicated than that. If China invades Taiwan, then the whole world is screwed. There would be a massive shortage of computers, phones, televisions, and the military would have difficulty restocking weapons, presenting a massive threat to national security of the United States and NATO and the weakness could precipitate World War III. So it’s for good reason countries around the world are trying to build enough fabrication capacity outside of Taiwan in case they invade. TSMC already had to acquire a stockpile of Argon gas because a lot of Argon comes from Ukraine.
Good work baiting people into hysterics over politics without directly addressing the politics. Admittedly, it's low-hanging fruit these days as AT readers have proved they're prone to the usual overreactions common to other websites. The volume of responses does speak to your targeting.
Intel hasn't bought back any stock since the first quarter of 2021. What "government handouts" are you talking about, specifically?
In 2018, 2019, and 2020, before Gelsinger took over, Intel bought back a lot of shares, which was a big mistake for the company, as they should have been using that money for capital investment they are now trying to catch up on. But it wasn't from "government handouts".
Many people (correctly) see the CHIPS act as a government handout because the govt is paying them to do what is a normal part of their business, which they should have done with their revenue in the first place.
Nobody could possibly predict that the current expansion in North America (and European) fabs in addition will lead to massive over capacity in 5 years time..
Possibly that could lead to cheap chips, or unpleasent wasteful shutdowns.
Reading between the lines/the room makes it clear that the 'US' is actually really concerned about losing Taiwanese chip capacity .. does that become a self fulfilling prophecy?
The most important and interesting question here is also the one that has not been asked: to what extent does * Brookfield Asset Management* get to control the inside of that fab?
That means everything from - what equipment gets bought? (Intel 10nm debacle probably started with Intel not being willing to buy EUV equipment) - who designs the process? (Intel's process since 14nm seems to have been designed by marketing with the goal of producing slides that can pwn TSMC. Does BAM get to bring in adult supervision and cautious improvement rather than huge moonshots that then explode on the launchpad?) - who gets access to the fab? (Does Intel get to create their own custom processes like i4 that aren't shared with fab customers? I can't imagine BAM are especially thrilled with such a procedure...)
It's these sorts of issues which determine whether BAM are being played for a patsy, or whether this can actual turn Intel around.
I guess everyone knows how much Samsung is subsidized by Korea, and everything that is subsidized in China?
Intel past isn't under the current CEO so equating the past behavior with now is foolish. The EU also as noted has made grants its because these countries realize that the higher costs to build in the US have put Intel and others at disadvantages structrually.
It hasn't helped that the 10 nm node was a huge miss where Intel tried to do too much all at once. Had they executed it would have been better than what TSMC and Samsung had at the time but it just didn't yield fast enough and they didn't do the normal backup plans etc.
Intel had a huge miss with Netburst and recovered the lead later with Core. Now there is M1 and M2 Silicon and AMD is resurgent, but Intel is huge. If they are given time there will be people to turn the ship and they will be competitive again and with acquisitions like Tower and Altera it may be interesting what they are going to do and offer IP wise.
I think honestly though that Silicon technology is coming to an end here with all around gate devices and EUV. Things will be about economies of scale going forward. I think Intel knows that and is trying to reach that scale.
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meacupla - Wednesday, August 24, 2022 - link
I bet the fabs would be cheaper to build, if Intel didn't give their government handouts (chips act) to their shareholders."Here's a blank check for $76,000,000,000. Go spend it on anything you want, no strings attached. Oh, and here's the loophole in the law we put in specifically, because you offered money to us".
catavalon21 - Wednesday, August 24, 2022 - link
If the Gov is silly enough to give a public company with share holders and an expectation of profit a blank check with no strings, that's what they get.meacupla - Wednesday, August 24, 2022 - link
No, I don't think you understand.This is not "You get what you deserve, because gov is too dumb".
This is what is called "legalized bribery and corruption".
RealBeast - Thursday, August 25, 2022 - link
You must have done very poorly in law school, or perhaps are too simple to understand that all companies make lawful donations to politicians to get benefits in return.Do you think that Intel is the only company make donations or reap such rewards? lol
ripsteakjaw - Tuesday, August 30, 2022 - link
oh, well, I guess it's okay then, it's lawful.lucaB75 - Sunday, September 11, 2022 - link
you really dont understand. USA lost their technological edge and government is trying to catch up. problem is they are bunch of idiots, old people that read news instead of looking for new trends . finally they finance mature industriesquorm - Wednesday, August 24, 2022 - link
Spend the past decade+ investing in stock buybacks instead of r&d and get rewarded by the gov't with more money to give the stockholders. Future looking bright for Intel.RedGreenBlue - Wednesday, August 24, 2022 - link
They’re like a normal company that has to reward investors. Coca Cola pays out dividends too. There’s nothing wrong with it. Dividends are a necessary part of corporate finance. Otherwise Intel wouldn’t exactly be interesting to own for investors who want a more reliable return. That’s capitalism, get over it. You don’t seem to understand much about that bill.“Companies are prohibited from using awarded funds through the CHIPS program for stock buybacks or payment of dividends. The expansion clawback in the bill requires the recipients of federal financial assistance not to engage in certain material expansions of semiconductor manufacturing in countries of concern.”
RedGreenBlue - Wednesday, August 24, 2022 - link
A big part of why Intel is doing this is because their fab roadmap has been a mess for almost 10 years and they need help to stay competitive in the current market and it’s taken years gor them to realize their old paradigm can’t survive.quorm - Wednesday, August 24, 2022 - link
If you believe that, I have a bridge i'd like to sell you. As if paying for their fab capex doesn't allow them to distribute more cash via buybacks.I'm not talking about dividends. Buybacks, which were illegal until the 80's, boost the stock price, allow investors to defer/reduce taxes and get CEOs fat bonuses. Intel is in no way unique, Apple, Cisco, Boeing, etc. all do the same thing, and it's BS.
Intel does not need help to stay competitive. They need to invest in r&d and fabs instead of artificially boosting their stock price.
RedGreenBlue - Wednesday, August 24, 2022 - link
You do realize it’s a bit more complicated than that. If China invades Taiwan, then the whole world is screwed. There would be a massive shortage of computers, phones, televisions, and the military would have difficulty restocking weapons, presenting a massive threat to national security of the United States and NATO and the weakness could precipitate World War III. So it’s for good reason countries around the world are trying to build enough fabrication capacity outside of Taiwan in case they invade. TSMC already had to acquire a stockpile of Argon gas because a lot of Argon comes from Ukraine.quorm - Wednesday, August 24, 2022 - link
Lol, this post is liberal bingo.Threska - Wednesday, August 24, 2022 - link
Except the chip shortage is more than just Taiwan.https://youtu.be/YJrOuBkYCMQ
PeachNCream - Thursday, August 25, 2022 - link
Good work baiting people into hysterics over politics without directly addressing the politics. Admittedly, it's low-hanging fruit these days as AT readers have proved they're prone to the usual overreactions common to other websites. The volume of responses does speak to your targeting.You get a 6/10 for troll quality. Nice work!
Yojimbo - Thursday, August 25, 2022 - link
Intel hasn't bought back any stock since the first quarter of 2021. What "government handouts" are you talking about, specifically?In 2018, 2019, and 2020, before Gelsinger took over, Intel bought back a lot of shares, which was a big mistake for the company, as they should have been using that money for capital investment they are now trying to catch up on. But it wasn't from "government handouts".
quorm - Friday, August 26, 2022 - link
You are correct that the buybacks stopped in 2021. But they are not a "mistake", as they have been going on for a long time. https://www.intc.com/stock-info/dividends-and-buyb...Many people (correctly) see the CHIPS act as a government handout because the govt is paying them to do what is a normal part of their business, which they should have done with their revenue in the first place.
lucaB75 - Sunday, September 11, 2022 - link
fabs will cost the same, silly comment.xol - Wednesday, August 24, 2022 - link
Nobody could possibly predict that the current expansion in North America (and European) fabs in addition will lead to massive over capacity in 5 years time..Possibly that could lead to cheap chips, or unpleasent wasteful shutdowns.
Reading between the lines/the room makes it clear that the 'US' is actually really concerned about losing Taiwanese chip capacity .. does that become a self fulfilling prophecy?
coburn_c - Wednesday, August 24, 2022 - link
Almost certainly doesquorm - Thursday, August 25, 2022 - link
$15B half a fab$6B a gpu with broken drivers only available in china
$400B stock buybacks
$1B rhomboicosahedral CPU boxes
someone who is good at the economy please help me budget this. my multi-decade process leadership is dying
name99 - Thursday, August 25, 2022 - link
The most important and interesting question here is also the one that has not been asked:to what extent does * Brookfield Asset Management* get to control the inside of that fab?
That means everything from
- what equipment gets bought? (Intel 10nm debacle probably started with Intel not being willing to buy EUV equipment)
- who designs the process? (Intel's process since 14nm seems to have been designed by marketing with the goal of producing slides that can pwn TSMC. Does BAM get to bring in adult supervision and cautious improvement rather than huge moonshots that then explode on the launchpad?)
- who gets access to the fab? (Does Intel get to create their own custom processes like i4 that aren't shared with fab customers? I can't imagine BAM are especially thrilled with such a procedure...)
It's these sorts of issues which determine whether BAM are being played for a patsy, or whether this can actual turn Intel around.
Meanwhile, in other "OMG, is there nothing Intel management cannot fsck up" news, I draw your attention to: https://www.computeexpresslink.org/_files/ugd/0c14...
Turns out that maybe the world does want persistent RAM – they just don't want anything to do with Intel and Optane if they can possibly avoid it?
cyrusfox - Thursday, August 25, 2022 - link
Intel is both part of JEDEC (https://www.jedec.org/about-jedec/member-list) and CXL (https://www.computeexpresslink.org/members)Issue with Persistant RAM is manufacturing cost.
ballsystemlord - Thursday, August 25, 2022 - link
@Anton I think you mean $100B."...of a small town as well as will cost up to $100 when fully built;..."
shack95 - Friday, August 26, 2022 - link
If semi conductors require a large amount of water for their production. Is building a plant in drought stricken south west really a good move?meacupla - Saturday, August 27, 2022 - link
No, it's an awful idea. It's even predicted that Lake Mead will completely dry out in 2023, if we go on with "business as usual".Threska - Sunday, August 28, 2022 - link
Water can be recycled in plant. It's actually better to do so (although not for the reasons you think).https://youtu.be/C3RzODSR3gk
drwho9437 - Sunday, August 28, 2022 - link
I guess everyone knows how much Samsung is subsidized by Korea, and everything that is subsidized in China?Intel past isn't under the current CEO so equating the past behavior with now is foolish. The EU also as noted has made grants its because these countries realize that the higher costs to build in the US have put Intel and others at disadvantages structrually.
It hasn't helped that the 10 nm node was a huge miss where Intel tried to do too much all at once. Had they executed it would have been better than what TSMC and Samsung had at the time but it just didn't yield fast enough and they didn't do the normal backup plans etc.
Intel had a huge miss with Netburst and recovered the lead later with Core. Now there is M1 and M2 Silicon and AMD is resurgent, but Intel is huge. If they are given time there will be people to turn the ship and they will be competitive again and with acquisitions like Tower and Altera it may be interesting what they are going to do and offer IP wise.
I think honestly though that Silicon technology is coming to an end here with all around gate devices and EUV. Things will be about economies of scale going forward. I think Intel knows that and is trying to reach that scale.