From late 2023, until a few weeks ago, it seemed as if Intel (NASDAQ:INTC) was finally making an exit from its extended slump. More recently, however, the INTC stock forecast has become a lot more cloudy. Following the chip maker’s latest quarterly results, sentiment for shares has shifted from upbeat back to downbeat. Intel’s AI growth catalyst has lost its excitement.

Growing uncertainty may also play a role in its turnaround plans. There are concerns its multi-billion dollar gamble on becoming a leading foundry for “fabless” chip designers are on the rise. Some recent news arguably casts doubt on when (or even if) this catalyst will play out. So, in light of the latest, what may lie ahead for shares? Let’s find out.

The Latest on Intel

While beating on earnings, Intel reported disappointing updates to its outlook Jan. 26 when it released its latest results. Although management attempted to signal that lackluster performance during the current fiscal quarter could prove temporary, the market isn’t confident about results in subsequent quarters.

This news suggests that AI growth won’t immediately impact positive results for investors like it does for Intel’s peers. INTC stock fell by 12% right after the earnings release, yet has continued to tumble.

This may be because of news related to the company’s foundry catalyst. Last week, Intel announced it was delaying the commencement of chip production (from 2025 to late 2026) at its $20 billion Ohio foundry (now under construction).

Some have speculated that this delay has to do with slower-than-expected receipt of U.S. Federal Government subsidies provided by the CHIPS Act.

However, another analyst (Bernstein’s Stacy Rasgon) argues that something else is behind it. Per Rasgon’s latest analyst research note on INTC, Intel is delaying the plant opening, due to the fact the company doesn’t need this capacity to come online as soon as initially expected.

AI Catalysts Remain in Motion

It makes sense that the market has dialed back its expectations for INTC stock in the short-to-medium term. The aforementioned outlook clearly shows that the company’s turnarounds remain a work-in-progress.

The jury’s still out whether more evidence that the comeback is taking shape will arrive in the quarters ahead. Regarding the latest foundry-related news, if Rasgon’s thesis proves correct, it may be questionable whether Intel soon experiences a material improvement in both revenue and earnings.

Then again, maybe not. “AI mania” for INTC may be waning right now, but over the next year, Intel’s much-anticipated AI catalyst could finally have an effect. Starting this year, Intel expects to experience “meaningful revenue acceleration” for its AI chips business. First, with its Gaudi 3 line of AI accelerators.

After that, the ramp-up in the production of PCs with AI capability could result in a demand bonanza for Intel’s AI-compatible CPUs.

With this in mind, there’s still the potential for Intel to experience its own “year of AI,” even if the AI catalyst merely enables the company to deliver results in line with current sell-side expectations.

INTC Stock Forecast: Bright Prospects, but Turbulence May Continue

Analyst consensus currently calls for Intel’s earnings recovery to begin taking shape in 2024, carrying on into 2025, with earnings per share rising from $1.36 to $2.33 per share during this time frame.

I don’t see the market moving INTC to a valuation on par with its high-flying competitors, but AI chip-driven earnings growth would undoubtedly reignite the “AI hype” that briefly propelled this stock higher during the late fall and early winter.

Having said all of this, when it comes to the INTC stock forecast, don’t assume it’s all smooth sailing from here.

In the near-term, uncertainty about overall chip demand and the foundry catalyst may continue to affect price performance negatively.

For those currently holding positions, patience is key. If you’ve yet to buy, “Watch and wait” may be the better course of action.

INTC stock earns a B rating in Portfolio Grader.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.