Business Breakdowns Intel: Cyclical Recovery or Secular Demise? - [Business Breakdowns, EP.149]
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Feb 14, 2024 Todd Ahlsten, CIO of Parnassus Investments and a semiconductor expert, delves into Intel's tumultuous journey. He discusses how Intel's shift from memory to logic chips under Andy Grove shaped its legacy. The conversation highlights missed opportunities in mobile markets and AI advancements. Ahlsten analyzes the cyclical nature of the semiconductor industry and outlines Intel's struggles and potential paths to recovery. He emphasizes the importance of strategic leadership and evolving consumer demands in navigating Intel's future in a competitive landscape.
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Todd Ahlsten's Semiconductor Journey
- Todd Ahlsten began covering semiconductor stocks in 1995 at age 22, tasked by his founder.
- This experience allowed him to witness eight semiconductor cycles, providing valuable insights.
Unique AI Cycle Dynamics
- The current AI cycle stands out due to its massive market demand and well-financed investors.
- Unlike the dot-com bubble, companies like Google and Microsoft possess substantial balance sheets, indicating a potentially more durable cycle.
Intel's Turnaround Potential
- Intel, despite missing the mobile market and falling behind TSMC, has the potential for a turnaround under Pat Gelsinger.
- Gelsinger's strategy involves regaining manufacturing leadership, splitting the company, and potentially becoming a major foundry player.