Re: Underlying results even worse
Well, throwing Intel Magdeburg and Ohio in the bin will save them two operating quarters of cash, each.
Berlin’s subsidy is a long way short of covering the additional cost of building in the EU. The EU’s plan was “Please build a fab planned to cost €20bn, will end up costing €30bn+ due to EU oversight costs, running costs €5bn annually, and we give €14bn subsidy to do it.” But the simple business alternative is to build the equivalent fab in APAC, nice predictable building cost €15bn, operating cost €3bn. Cheaper even by day 1, and goes on saving money forever. Chips Act isn’t income, it’s cost. EU Chips Act is worse than US money, but both are profit-negative for Intel if they proceed.
What’s at stake here is corporate embarrassment at withdrawing from the projects. But eventually, corporate survival will win. The silliness only stops when, as you say, the choice becomes to stop the dividend, go cap in hand to the banks (which won’t fund projects on that scale on acceptable terms), or throw the projects under the bus.