Intel plans to use the sharp rise in its stock price to raise new capital for expanding its chip production. The company has announced a $15 billion stock offering, though the final proceeds could turn out to be significantly higher.
The timing is favorable for Intel. Its stock has nearly tripled in value this year and has increased by about five times since August of last year, according to Reuters. As a result, Intel is outperforming AMD and Nvidia this year. The Philadelphia Semiconductor Index rose by nearly 75 percent over the same period.
The chipmaker needs the funds for an investment program that is growing in scale. Intel is seeking to expand its role as a manufacturer for other chip companies and is investing, among other things, in new factories, advanced packaging, and new production processes. Through these efforts, the company aims to become a more serious competitor to market leader TSMC.
In July, Intel had already raised its projected capital expenditures for this year from $18 billion to $20 billion. A key reason for this is the growing demand for processors for AI applications. According to the company, the rise of AI agents in particular is driving demand for CPUs that exceeds current production capacity.
Share sale could be larger
The announced stock sale is initially valued at $15 billion. However, Bloomberg reports, citing sources familiar with the matter, that Intel is aiming for approximately $20 billion. The shares are expected to be offered at a minimum of $95 each. That is about 2.6 percent below Monday’s closing price of $97.52.
Demand is reportedly significantly higher than the supply. According to Bloomberg, investors have expressed interest totaling more than $100 billion. Reuters was unable to independently confirm those figures.
Intel is also giving the underwriters the option to purchase up to $2.25 billion in additional shares within 30 days. JPMorgan Securities, Goldman Sachs, Morgan Stanley, and Citigroup Global Markets are underwriting the transaction.
The announcement put pressure on Intel’s stock on Monday, which lost more than 4 percent.
Foundry must grow
A significant portion of the investments will go to Intel Foundry. The company has now committed to large-scale production using its new 14A process starting in 2028. Intel had previously warned that it might not continue developing that technology if major external customers failed to materialize.
With Tesla, Intel has now found a customer for 14A. Apple may follow. U.S. President Donald Trump previously stated that Apple would have Intel manufacture its processors, but neither company has confirmed this.
Intel is also expanding its production capacity in Europe. Last month, the company announced a 5 billion euro investment to expand and modernize its manufacturing facility in Ireland. That amount represents more than a quarter of Intel’s planned capital expenditures for all of 2026.
Analysts had already anticipated a stock offering due to the combination of high investments and the sharply rising stock price. Russ Mould of AJ Bell points out that, in the 2010s, Intel actually spent $82 billion on share buybacks. According to him, following the sharp rise in its stock price, it makes sense for Intel to now use the stock market to strengthen its balance sheet and investment capacity.