Market Data 
By Stephen Nellis
(Reuters) -Semiconductor company Intel (NASDAQ:) disclosed increasing operating losses for its foundry business on Tuesday, according to a regulatory filing.
Intel said the manufacturing unit had $7 billion in operating losses for 2023, a steeper loss than the $5.2 billion in operating losses the year before. The unit had revenue of $18.9 billion for 2023, down 31% from $63.05 billion the year before.
Intel shares were down 4.3% after the documents were filed with the U.S. Securities and Exchange Commission (SEC).
During a presentation for investors, Chief Executive Pat Gelsinger said that 2024 would be the year of worst operating losses for the company’s chipmaking business and that it expects to break even on an operating basis by about 2027.
Gelsinger said that the foundry business was weighed down by bad decisions, including one years ago against using extreme ultraviolet (EUV) machines from Dutch firm ASML (AS:) . While those machines can cost more than $100 million, they are worth it because they are such an improvement over their predecessors.
Intel has now switched over to using EUV machines, which will cover more and more production needs as older machines are phased out.
“In the post EUV era, we see that we’re very competitive now on price, performance (and) back to leadership,” Gelsinger said. “And in the pre-EUV era we carried a lot of costs and (were) uncompetitive.”
Intel plans to spend $100 billion on building or expanding chip factories in four U.S. states. Its business turnaround plan depends on persuading outside companies to use its manufacturing services.
As part of that plan, Intel told investors it would start reporting the results of its manufacturing operations as a standalone unit. The company has been investing heavily to catch up to its primary chipmaking rival, Taiwan Semiconductor Manufacturing Co.
