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Intel headquarters in Santa Clara, Calif.
David Paul Morris/Bloomberg
Intel shares are gaining ground late in Thursday’s trading session after CEO Pat Gelsinger said that third-quarter financial results are running above the midpoint of the company’s guidance range. Intel had previously forecast third-quarter revenue of between $12.9 billion and $13.9 billion.
Gelsinger made the comment at a
Deutsche Bank
investment conference.
The Intel CEO also said that the company has received “a large customer prepay” for “18A” manufacturing capacity, a reference to the company’s development of 1.8 nanometer production lines, which will be used to produce cutting-edge chips.
Based on that prepayment, Gelsinger said, Intel is accelerating construction of its new chip fabrication facility in Arizona. “Overall, everything is coming together,” he said. “And this customer prepay really is a strong exclamation point to momentum for 18A and the manufacturing capacity for that.”
Gelsinger didn’t say which customer had prepaid for manufacturing capacity.
Intel has been making a major push to expand its foundry business, manufacturing chips on behalf of other device companies. The company is building out all new fabs in both Arizona and Ohio as part of that strategy.
During the conference session, Gelsinger also responded to concerns that rapidly growing spending on
Nvidia
GPUs for AI applications might be crowding out demand for Intel’s own processors. He made the case that Intel will be “competing more for the GPU” market, and that the AI trend will “create opportunities” for Intel’s CPU chips as well.
Intel shares on Thursday are 1.8% higher, at $35.15.
Write to Eric J. Savitz at eric.savitz@barrons.com