Key Takeaways
- On TIKR’s cash-from-operations-minus-capex measure, Intel generated about $4.45 billion of free cash flow in the June quarter, its best in the eight-quarter view.
- Weighted diluted shares rose from 4.37 billion to 5.10 billion in a year, before an August offering of about $23 billion is reflected.
- Intel raised the money before the 10-year Treasury yield reached 5.34%. The test now is whether the spending earns a return.
Intel’s cash flow just turned sharply positive, right before capex is set to climb. Compare Intel’s cash flow and capex on TIKR for free →
Intel Stock Raised Its Money Before the Window Narrowed
On Thursday, the 10-year Treasury yield hit 5.34%, its highest since 2002, and Reuters reports some tech IPOs are being delayed as borrowing costs bite. Intel was already done. In August it sold about $23 billion of stock at $95 a share, and it closed at $120 on October 1.
The need shows in the cash flow. Operating cash flow was $7.01 billion in the June quarter against $2.56 billion of capex, leaving about $4.45 billion of free cash flow, calculated as the difference. Over the last four quarters that nets to roughly $2.8 billion, compared with a burn of about $10.9 billion in the four quarters before.
But capex is guided above $20 billion for 2026 and “significantly above” that in 2027. Intel reported about $7.6 billion of gross capex in the first half, before partner contributions and government incentives. That implies more than $12.4 billion in the second half, or over $6.2 billion a quarter.
The price of that cushion was dilution. Weighted diluted shares climbed about 17% over four quarters, before the August sale.
Intel’s Capex Now Has to Earn Its Keep
Funding looks settled for now. Intel ended the second quarter with about $30 billion of cash and short-term investments, and CFO David Zinsner said capital raising precedes the investment. The more complicated question is return. Foundry lost $2.1 billion in the quarter on $293 million of external revenue, and Zinsner has said the end-2027 breakeven target could slip into 2028.
If quarterly gross capex runs above $6 billion while foundry losses stay near $2 billion, the raise is being spent faster than it is earning back, and the roughly 4.8% dilution reported for the August sale would look expensive.
Watch the 14A design kit due in October, then third-quarter capex and external foundry revenue.
Capex pace and external foundry revenue in the third quarter will show whether the raise is paying off. Follow Intel’s capex and cash flow on TIKR for free →
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
