As the artificial intelligence arms race continues in 2024, investors might wonder whether Intel (NASDAQ:INTC) is a worthy competitor in the AI-hardware market. At least, we can conclude that Intel is trying very hard to succeed in this field. INTC stock earns a “B” grade and may be worth a small purchase, but it’s not an absolute requirement for everyone’s portfolio.
Another consideration is that Intel is developing its chip foundry business. This means that Intel may benefit from government support of domestic chip production. So, once again, investors might consider Intel stock for a small portfolio allocation.
Intel Goes Full-Tilt With AI Push
Make no mistake about it, Intel really wants investors to know that the company is all about AI now. For instance, Sandra Rivera, CEO of Intel’s programmable chip unit, recently emphasized the applications of programmable chips for AI use cases.
Intel announced a new product called Edge Platform, which “simplifies” the “development, deployment and management of edge AI applications.” In addition, Intel is teaming up with cybersecurity company BUFFERZONE to offer an AI-powered anti-phishing solution.
And in case you didn’t get the message by now, Sachin Katti, senior vice president and general manager of the Network and Edge Group at Intel, stated outright that Intel wants to “bring AI everywhere.” In the press release associated with Katti’s quote, Intel mentions AI dozens of times.
The market isn’t just taking Intel’s word for it. For now, INTC stock remains far below its 2020 peak of around $70. Intel needs to show that it can consistently generate robust revenue and income from AI. It remains to be seen whether Intel will succeed in this endeavor in 2024.
Government Support Could Help Intel
As you’re probably aware, the CHIPS and Science Act earmarks funding to encourage U.S. chipmakers like Intel to ramp up their domestic chip production. Reportedly, Commerce Secretary Gina Raimondo stated that chip makers like Intel are seeking over $70 billion worth of funding from the CHIPS and Science Act.
That’s a lot of money, but these chip makers might actually get what they’re asking for. As Yahoo! Finance reported, the Biden administration’s aim is for the U.S. to “produce 20% of the world’s most advanced semiconductor chips by the end of the decade.”
According to Yahoo! Finance, the U.S. “makes 0%” of these high-end chips. Just think about what it will take to get from zero to 20% within six years.
It will, very likely, require financial incentives from the government. Certainly, the U.S. will seek to boost its domestic advanced chip production capacity in the coming years. Intel, with its chip-making foundry business, will play an essential role in this and could receive substantial financial support.
INTC Stock: No Need to Load the Boat on This
Intel is apparently eager to convince investors it’s now a full-fledged AI-hardware company. Yet, Intel needs to convince the market that its AI-focused push will result in robust sales and income.
U.S. government support could help Intel boost its domestic advanced chip production. In the final analysis, INTC stock deserves a “B” grade. It’s not essential, but could be a worthy asset for a small-sized portfolio allocation.
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.
