- Intel is now seeking to increase the amount it’s raising in a share sale to about $20 billion, according to people familiar with the matter, a third more than it was targeting when it announced the deal Monday morning.
- The offering is expected to be priced at around $95 per share or above, representing a 6.5% discount to Friday's closing price.
- Intel's stock fell as much as 5.3% to $96.30 on Monday following the announcement, but shares are up more than 160% this year.
- Proceeds from the share sale will fund AI, foundry, and other projects, with CEO Lip-Bu Tan prioritizing cleaning up finances.
- Intel is capitalizing on renewed interest in its prospects driven by the artificial intelligence (AI) data centre boom.
- The worldwide expansion of data centres key to powering AI systems has bolstered demand for its general processors and its finances.
- Sales in Intel’s data centre segment soared 59% last quarter, more than double the pace of Intel’s overall revenue.
- Proceeds from the share sale will provide substantial capacity to fund AI, foundry and other projects without adding leverage.
Intel is poised to increase its share sale to approximately $20 billion, capitalizing on the booming demand for AI technologies. The chipmaker's stock has surged 160% this year, elevating its market value to nearly $500 billion.145
The offering, which may be Intel's first public share sale since 1971, is set to price around $95 per share, representing a 6.5% discount to its recent closing price. The funds will be allocated for general purposes, including enhancing Intel's capabilities in the AI sector and expanding its factory network.23
Intel's data center sales soared 59% last quarter, significantly outpacing its overall revenue growth. This surge is attributed to the global expansion of data centers essential for AI systems, which has increased demand for Intel's processors. However, the company still lacks a dedicated AI business to compete with industry leaders like Nvidia and AMD.
According to Bloomberg Intelligence analyst Robert Schiffman, the proceeds from the share sale will provide substantial capacity to fund AI and foundry projects without increasing debt. He noted that this trend reflects a broader theme in AI infrastructure, where rising investments do not solely rely on bondholders, drawing parallels with major tech firms like Oracle, SpaceX, and Microsoft.6711
“The offering would be Intel's first public share sale since its 1971 listing, with proceeds earmarked for general purposes and to fund AI, foundry, and other projects without adding leverage. CEO Lip-Bu Tan has made cleaning up finances a priority, attracting outside investments from the US government and rivals.”
