⚠ The Foundry Sells to Intel at Prices Intel SetsModerate threat

Intel (INTC) — threat to the moat

Intel's foundry loses money partly because Intel decides what it pays its own factories, so the honest figure is the company's combined loss.

Intel Foundry's revenue is almost all internal, which means its losses depend on the prices Intel's product groups pay it. Intel's internal foundry operating model took effect in 20241, and intersegment revenue was $17.5 billion in 20252. A higher internal price would shrink the foundry's loss and the product groups' profit by the same amount.

Operating income, 2025 ($M)12,739Intel Products-10,318Intel Foundry-5,518Corporate unallocated-2,214Intel totalIntel Form 10-K FY2025, Note 3
The segments net to a loss.

So the segment split is not the whole truth. The truer figure is the combined result: Intel's consolidated operating loss was $11,678 million in 2024 and $2,214 million in 20253, and eliminations and corporate costs sit between the segments and that total4.

The structure still serves a purpose. It shows how much it costs to run leading-edge factories for a single customer, and it is the price an external customer would compare with TSMC's.

Corporate costs sit outside both. Share-based compensation, restructuring and acquisition-related charges are held in corporate unallocated, $5,518 million in 20255. Adding the pieces together, the product groups' profit of $12,739 million, the foundry's loss of $10,318 million and the corporate charges produce Intel's operating loss of $2,214 million6; the internal price moves profit between segments, not into the company.

The fair test is the one outsiders apply. When an external customer signs, the price it pays will show what Intel's manufacturing is worth on the open market.

References
  1. ReportedIntel's internal foundry operating model took effect in 2024, and intersegment revenue was $17.5 billion in 2025.
    Intel Form 10-K for fiscal 2024 - the 2024 restructuring, dividend suspension, goodwill impairment and headcount. — FY2024 · publ. January 2025 · source ↗
  2. ReportedIntel's internal foundry operating model took effect in 2024, and intersegment revenue was $17.5 billion in 2025.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - Item 7 MD&A and Note 3: segment revenue, operating income and drivers. — FY2025 · publ. 23 January 2026 · source ↗
  3. ReportedThe truer figure is the combined result: Intel's consolidated operating loss was $11,678 million in 2024 and $2,214 million in 2025, and eliminations and corporate costs sit between the segments and that total.
    Intel fourth-quarter and full-year 2025 results release, Form 8-K exhibit 99.1 - statements, capital spending and adjusted free cash flow. — FY2025 · publ. 22 January 2026 · source ↗
  4. ReportedThe truer figure is the combined result: Intel's consolidated operating loss was $11,678 million in 2024 and $2,214 million in 2025, and eliminations and corporate costs sit between the segments and that total.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - Item 7 MD&A and Note 3: segment revenue, operating income and drivers. — FY2025 · publ. 23 January 2026 · source ↗
  5. ReportedShare-based compensation, restructuring and acquisition-related charges are held in corporate unallocated, $5,518 million in 2025.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - financial statements and notes: results, capital, government and partner transactions, restructuring and tax. — FY2025 · publ. 23 January 2026 · source ↗
  6. ReportedAdding the pieces together, the product groups' profit of $12,739 million, the foundry's loss of $10,318 million and the corporate charges produce Intel's operating loss of $2,214 million; the internal price moves profit between segments, not into the company.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - Item 7 MD&A and Note 3: segment revenue, operating income and drivers. — FY2025 · publ. 23 January 2026 · source ↗
Sources
Generated September 25, 2026