Intel Corp at RBC Capital Markets Global Technology, Internet, Media & Telecommunications Conference Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : <_ALACRA_META_ABSTRACT>Yeah, that wasn't easy, but, hey, made it. Okay. Yeah. Thanks for joining, John. So it's been about eight months since Lip-Bu joined and a lot of changes -- gone through a major restructuring. I would say, the past three months, a lot of news flow, mostly positive. So maybe start with that now that the restructuring is done, the balance sheet is in pretty good shape. And also you got into a partnership with NVIDIA. That certainly has been quite positive. So let's talk about, what's on the plate for the management as we look out to the next 6 to 12 months? Maybe we can talk about, what are the top two or three priorities for the management going forward?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Okay. That's a good start. Maybe we can start with the NVIDIA partnership because that gets a lot of attention. So NVIDIA is investing $5 billion in Intel. At the same time, you're going to be part of NVLink Fusion. Maybe talk about what's your current position is when it comes to AI, head node CPUs, and how this might actually change it, maybe enhances it. And also, if you can touch upon what workloads are we talking here because NVIDIA seems to be doing quite well with their own ARM CPU, and now they're entering a partnership with you. So how do you see that opportunity? Are there different workloads that x86 is going to target? Just anything you can tell us about the timing and the potential opportunity of that.

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Yeah, it makes -- so just to be clear, so this is a custom CPU that you're going to sell directly to NVIDIA? This is not going to a third-party hyperscaler?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Got it. And you haven't talked about the timing or potential?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Got it. Got it. And then on the PC side, client side, I mean you have your own graphics development, right? Today, you sell a lot of integrated GPUs. So I mean when you say you're going to package NVIDIA's RTX into Intel CPUs, how does that mean? Are you targeting a particular market with NVIDIA solutions? Or what happens to your own internal tailwinds?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Okay. That makes sense. Maybe switching gears a little bit here. I mean, talking about the overall AI strategy for Intel, right? On one hand, you just mentioned, there's a lot of opportunity on the x86 CPU itself. And then I guess on the PC market, you guys talked about potentially shipping 100 million AI PCs this year. But at the same time, when it comes to XPUs, it's supposedly $1 trillion market and you're missing out on that. What's the strategy? I guess where do you think you can intersect that market? And what's the approach internally? Maybe anything you can tell us about?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Okay. That makes sense. And then there was also a mention of customization on ASIC on the last earnings call. So just to level set, are we talking ASICs similar to what Broadcom and Marvell are doing, or is this something different? What's the approach here? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. NOVEMBER 18, 2025 / 8:20PM, INTC.OQ - Intel Corp at RBC Capital Markets Global Technology, Internet, Media & Telecommunications Conference

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Not me, right?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : What do you think is the differentiator here? Obviously, Broadcom would argue that they've been doing this for almost 30 years since Avago -- I mean, there's still Avago. And Marvell, they come from IBM legacy. What is that Intel brings to the table that the market --?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Right, right. I mean there's a lot of chatter about even companies like Broadcom, potentially doing rack-level solutions, right? I mean, you obviously have done historically some reference designs on that front. But do you feel that you have all the pieces that go into building a rack system at this point? Or do you think you need to acquire any of those?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Got it. And then obviously, we talked about balance sheet being pretty healthy right now. There was some speculation in the market about potential M&A. I don't expect you to comment on that. But I guess would you completely rule out M&A as part of your AI strategy? Because it looks like there are enough start-ups out there, enough solutions out there that could be quite interesting.

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Makes sense. And then just switching gears a little bit to the near-term server demand, it's been pretty healthy despite the concerns about ARM gaining share or AMD gaining share, et cetera. You talked about supply constraints, et cetera. But talk to us about the road map on the server side. AMD hosted their Analyst Day, and they gave us some targets about market share. They're targeting more than 50% share. So I'd love to hear your thoughts on how you think about it, not just this quarter or next quarter, but as you look out to the next two to three years. What's the strategy to stop those share loss and maybe potentially regain some share?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Got it. And then maybe we could touch upon a little bit on the margin side of things. Data center margins, if you compare, client margins are doing actually pretty well. On the other hand, data center is actually somewhat depressed versus history. So what is driving it? Is it more on the cost issue when it comes wafers? Or is it more R&D spending? Just any color on that, I think, will do.

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Right. Right. Yeah. So just to follow up on the margin front. You did pretty well in the quarter. You did 40% better than expected, but your guidance suggests 3, 4 points of decline sequentially. And then you made some comments about next year, what are the puts and takes. Maybe we can revisit them, right? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. NOVEMBER 18, 2025 / 8:20PM, INTC.OQ - Intel Corp at RBC Capital Markets Global Technology, Internet, Media & Telecommunications Conference So on one hand, the demand is very strong. You're supply constrained. I think the pricing is generally pretty healthy. But on the other hand, you have new products ramping and you also have some mix headwinds. So as we think about next four, six quarters, what are the two, three puts and takes that are going to impact the gross margins?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : It makes sense. When do you think Lunar Lake will peak out in terms of -- as a percent of the overall mix? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. NOVEMBER 18, 2025 / 8:20PM, INTC.OQ - Intel Corp at RBC Capital Markets Global Technology, Internet, Media & Telecommunications Conference

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Right. And there are no supply constraints on the Lunar lake front because it's mostly --

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Okay. So when you talk about supply constraints, we're not just talking about Intel 10, 7, which is in-house, but also the wafers that are coming from TSM are tight as well?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Got it. Got it. And then, obviously, Panther Lake and the yields, 18A, there's a lot of focus on that. Maybe looking at history, when you launch a new product like Panther Lake, how long does it take before that product becomes, I guess, a higher percent of the overall mix? When does that crossover happen?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Okay. And then just to follow up on that margin comments. I guess on the earnings call, you sounded optimistic about margins improving through all of next year and maybe by end of next year, getting to an accretive level. I think that was the term used. So I guess it depends on the yields, and you talked about them right now. But longer term, given that this is a new process for you and assuming that the yields shake out where you expect them to be, how should we think about your longer-term margin potential here? I mean, I don't know when the last time you guys gave us a long-term model. But are we talking a 5-handle in front of gross margin? Is it a 6-handle? How should we think about that?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Okay. We'll definitely look forward to the Analyst Day. I want to switch gears to the Foundry side. Obviously, it's a challenging business. And I think you talked about 18A potentially leading to a breakeven point at some point. I think in the past, you said maybe 2027. I don't know if that's still valid or not. And then also, you made -- I think since Lip-Bu took over, there's also a comment that if you don't get a material customer for 14A, you might actually stop process node development. So my question is, is 2027 still the target for Foundry breakeven?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Yeah. It's probably a good problem to have. We've got a couple of more minutes. I want to see if there are any questions from the audience. Okay. We'll keep going. So again, the 14A process node comment that caught a lot of attention, right? But at the same time, you also said until 2030, you're good with 18A, 18A-P for your internal product, so you don't have to -- you actually don't need 14A for internal products, right? So talk to us about -- if you were to hypothetically give up 14A development, what does that do to your, I guess, OpEx or CapEx? How does that impact the business model?

Question: Srini Pajjuri - RBC Capital Markets Inc - Analyst : Got it. That's all the time we have. And thanks, John. Appreciate it.