Intel’s Shareholder Mandate and Apple’s Limited Foundry Role: A Tale of Two Realities

Intel’s annual general meeting on May 13 delivered a resounding endorsement of leadership, but the market had already moved on to assessing the real-world implications of the company’s most talked-about customer win. With 79.11 percent of voting capital represented, shareholders re-elected all 11 board nominees, approved executive compensation, and shot down activist resolutions on China risks, human rights, and the proposed permanent separation of the chair and CEO roles. The message from the owner base was clear: give management room to execute. Yet by Friday, the stock had given back more than 11 percent of its value for the week, as the scale of the Apple foundry arrangement began to sink in.

Supply-chain analyst Ming-Chi Kuo confirmed that Apple is already having Intel manufacture older, simpler processors for iPhone, iPad, and Mac using the 18A-P series with Foveros packaging. The partnership is no longer a rumor, but its scope is far narrower than the market had hoped. TSMC is still expected to cover more than 90 percent of Apple’s chip needs, and Intel’s initial yield target for 2027 sits at just 50 to 60 percent or higher. Even a clean ramp would not pry Apple away from its dominant supplier anytime soon. That dose of reality sent Intel shares to a close of €93.71 on Friday, down 5.75 percent on the day and 11.54 percent for the week.

The pullback came after a breathtaking run. The stock had touched a 52-week high of €109.88 on May 11, and despite the retreat still stands 178.86 percent higher since the start of the year. That kind of rally attracted a heavy short-seller presence, and the correction amplified their pain — but also their stubbornness. According to S3 Partners, bearish bets have generated book losses of more than $12 billion, yet the short interest as a percentage of free float remains near a yearly peak. The dynamic creates a self-reinforcing loop: any dip is worsened by shorts who are already underwater and cannot easily cover. Friday’s selloff was further fueled by a broad rotation out of semiconductor names ahead of Nvidia’s quarterly report.

Should investors sell immediately? Or is it worth buying Intel?

Fundamentally, Intel’s recent results offer real reasons for optimism. First-quarter revenue reached $13.577 billion, beating the midpoint of guidance by $1.4 billion and surpassing analyst expectations by 9.22 percent. Adjusted earnings per share came in at $0.29, well above the break-even forecast the company had issued. The data-center and AI segment grew 22 percent year over year, while Intel Foundry notched a 16 percent revenue increase. CFO David Zinsner told investors that yields on the advanced 18A process are running ahead of internal plans, and the target originally set for year-end may be achievable by mid-2026.

Yet the foundry business remains a drag. It posted an operating loss of $2.4 billion in the first quarter, a burden that the rest of the company must carry and a reminder that profitability in chip manufacturing is still years away. Analysts have taken note of the progress even as they recalibrate. Mizuho raised its price target to $124 on May 12, and Deutsche Bank lifted its target to $100 on the same day, citing the structural improvement in yields.

For Intel, the Apple contract is a marquee endorsement of its foundry strategy. It signals that the company is regaining credibility in external manufacturing, and it gives customers beyond Apple more reason to consider Intel as a second source. But the concrete test lies ahead: the ramp-up of Apple production next year. Intel must deliver stable yields and demonstrate that Apple is willing to allocate more than marginal volume. The board’s solid shareholder mandate buys management time, but the market’s snap reaction to the limited Apple scope shows that the bar for re-rating has been set high.