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QS Research · Michael Burry's Scion Capital analyst template · 2006

INTEL CORP (INTC)

As of 2026-11-02 · 12/15 boxes filled from SEC filings and market data

Conclusion: WATCH

Conviction low · base case -9% · downside -55% · upside +37%

Intel is cheap relative to its 52-week high but not cheap on normalized fundamentals: FY2020-FY2025 average EBITDA of $15.30B at the midpoint of the GFS-AMAT multiple range (21.65x = (11.6x + 31.7x)/2) gives EV $331.2B; after net debt of $28.28B and 5,315M shares, that is $57.0/share, 9% below today's $62.63. The downside to GFS 11.6x is -55% while the upside to AMAT 31.7x is only +37%, so the risk/reward is skewed to the downside. DCAI growth (+78% y/y) and Q3 2026 gross margin of 43% are real, but PC weakness into H1 2027, negative normalized FCF of -$1.99B, and TTM net income of -$12.03B prevent a margin of safety. I would not buy here; I would wait for a lower price or evidence that data center strength can durably offset the PC/foundry drag.

Key numbers

The 15 boxes

  1. ✓ 1. Long-form business notes

    Intel's revenue peaked in FY2021 at $79.02B and fell to $52.85B by FY2025, with FY2022 revenue of $63.05B after a sharp contraction. Gross profit fell from $43.81B in FY2021 to $18.38B in FY2025, and operating income turned negative in FY2024 and FY2025. Cash generation weakened, and buybacks stopped after FY2021, while equity still rose to $114.28B by FY2025.

  2. ✓ 2. Competitive advantage

    Intel's main potential durable advantage is its x86 ecosystem, with decades of developer and software compatibility (S25). However, financials over the cycle show collapsing profitability: revenue fell from $79.02B in FY2021 to $52.85B in FY2025, and operating income swung from $19.46B to -$2.21B (S27). In foundry, TSMC holds the leading edge, with Samsung as direct competitor (S25). Overall, the margin and return history points to a weakened moat rather than a durable advantage.

  3. ✓ 3. 10-Q takeaways

    Q3 2026 net revenue was $16.5B, up $2.9B YoY, driven by data center strength; gross margin improved to 43.0% from 38.2%. Client weakness and inventory-related charges hit CCPG, while Foundry losses narrowed but remained negative. One-offs (escrowed-share gain/loss, Altera sale, goodwill impairment) dominate net income; operating income Q3 2026 was $2.5B (15.3% of revenue). Outlook: data center demand strong into Q4 2026, client trends worsen, supply constraints persist, Israel fab accident adds Q4/2027 costs; August stock offering raised $22.6B.

  4. ✓ 4. Corporate governance
  5. ✓ 5. Overview of the prior 3 years of 8-K filings
  6. ✓ 6. Other significant filings
  7. ✓ 7. Chronology of significant news and events
  8. ✓ 8. Comparables valuation interpretation
  9. ✓ 9. Insider trading interpretation
  10. ○ 10. Earnings-call notes
  11. ○ 11. Impression of the shareholder letter
  12. ○ 12. Scuttlebutt overview
  13. ✓ 13. Valuation and risk/reward summary
  14. ✓ 14. Current price suppression and potential catalysts

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