Intel Corp.’s stock surged late Tuesday as the chip maker announced aggressive plans to expand its manufacturing capacity to take back its leadership position in the industry .
Gelsinger said Intel was investing $20 billion in a “major factory buildout” at its Ocotillo, Ariz. facility, and plans to announce other expansion plans this year. Last year, Intel spent $14.3 billion on capital expenditures. While Intel is likely to benefit from the government’s push to re-establish U.S.-based chip manufacturing, Gelsinger said Intel is not factoring that into its plans.
Also, Intel forecast revenue of $76.5 billion and adjusted earnings of $4.55 a share for 2021, after not providing a full-year outlook in its previous earnings report. Analysts surveyed by FactSet expect an average of $76.64 billion and adjusted earnings of $4.78 a share. In chip parlance, nanometers, or nm, refers to the size of the transistors that go on a computer chip, with the general rule being that smaller transistors are faster and more efficient in using power. Rival Advanced Micro Devices Inc. AMD, -2.39% started rolling out its 7-nm chip in the summer of 2019.