Intel Faces Construction Delays in Ohio Chipmaking Project
Intel is encountering obstacles in its $20 billion chipmaking project in Ohio, with construction delays attributed to market challenges and sluggish U.S. grant disbursement. The original timeline, envisioning chip production starting next year, has been pushed back, with manufacturing facilities now expected to conclude construction by late 2026, according to sources closely associated with the project. Intel’s stock experienced a 1.5% decline in extended trading following this development.
Despite the delays, Intel remains resolute in completing the project, as affirmed by a company spokesperson. Construction is actively progressing, and substantial strides have been made in the past year. The spokesperson acknowledged the inherent flexibility required in managing large-scale projects, often necessitating adjustments to timelines.
Market Challenges and Revenue Projections
Intel projection of first-quarter revenue below market estimates last month is attributed to uncertain demand for its chips, particularly in traditional server and personal computer markets. The evolving landscape, marked by a shift in spending towards AI data servers dominated by competitors Nvidia and Advanced Micro Devices, has adversely affected the demand for core data center offerings in the traditional server chip segment.
In this dynamic environment, the company grapples with navigating market challenges while staying committed to the ambitious chipmaking project in Ohio.
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