Intel's strategy to revive its foundry business is producing results one after another. Buoyed by an AI-driven semiconductor boom, the company has pushed through bold price increases and is moving aggressively to secure next-generation technology, signaling growing confidence.
Intel plans to raise prices for PC central processing units by about 10% in October, Taiwanese technology publication DigiTimes reported on the 8th, citing industry sources. Intel shares jumped 9.1% to close at $104.47 on the news, even as all three major New York indexes fell. The stock has gained about 144% this year.
Intel has raised CPU prices several times this year as demand increased. It lifted PC CPU prices by about 10% in the first quarter and raised prices on some products, including the Core Ultra 7 270K Plus, in July. Rising prices for memory and other key components have strengthened Intel's pricing power. Building on that momentum, the company is prioritizing margin improvement over expanding market share through price cuts.
In second-quarter results released in July, Intel posted its strongest revenue growth in 15 years, helped by AI-related demand. Gross margin came in at 42%, a sharp improvement from 2.5% a year earlier. The company attributed the gain to economies of scale from higher volumes and its ability to sell chips at higher prices. Intel has also been securing major partnerships, agreeing in April to supply its 14A process technology, at 1.4 nanometers, to the Terafab project led by Tesla and SpaceX.
Intel's foundry unit, however, remains in the red. Foundry revenue was $5.8 billion in the second quarter, but the operating loss reached $2.1 billion. Heavy reliance on internal orders is another weakness, with external customer revenue at just $293 million. Intel is trying to break through those limits by adopting next-generation lithography equipment.
Intel and ASML said on the 8th that they had processed more than 1 million wafers using High NA EUV lithography systems, a next-generation technology. The figure includes early test runs and cannot be viewed entirely as production volume. Still, experts say 1 million wafers is an indicator that the technology has entered a phase of stable operation. It marks the first time Intel's push to revive its foundry business has been confirmed in numbers.
High NA EUV lithography systems, produced exclusively by ASML worldwide, are a next-generation technology that raises the numerical aperture of EUV tools to 0.55 from the current 0.33, allowing finer circuits to be patterned. Intel installed the world's first commercial High NA EUV system at its plant in Oregon in 2024. According to ASML, cumulative wafer output using its High NA EUV systems worldwide stands at about 1.35 million. With Intel accounting for 1 million of that, the company's dominance in the field is clear. Foreign media described it as proprietary experience that rivals would take years to replicate.
Leading foundry players, however, appear to be in no rush to adopt High NA EUV tools. TSMC has set 2030 as its target for mass production, while Samsung Electronics is aiming for 2028 to 2029. The reasoning is that optimizing existing processes can deliver better yields and returns than installing High NA EUV systems, which cost as much as $400 million each, or about 530 billion won.
Another limitation is that Intel has yet to line up a major customer for its 18A process, which uses High NA EUV tools. Preliminary talks and partnerships are under way for 18A orders, but no actual contracts have been announced.
