INTEL CORP files 10-Q: quarterly report (10-Q)
Overview
This report should be read in conjunction with our 2025 Form 10-K where we include additional information on our business, operating segments, risk factors, critical accounting estimates, policies, methods and assumptions used in our estimates, among other important information.
Significant Events and Trends Impacting Results
The following discussion highlights significant events, key developments and trends that we believe meaningfully impacted our consolidated financial results and financial position during Q1 2026 or that we believe may continue to influence our future operating results and financial position, as well as specific matters that occurred in 2025 that impact the comparability of our results.
Future Node Development and Manufacturing Expansion Projects
As part of the transformation of the company, in Q2 2025 we announced that we would take a more disciplined approach to the deployment of capital. The design, development and manufacturing of leading-edge semiconductor manufacturing process technologies, or nodes, is risky and capital-intensive, and it takes years for capital investments to yield a return. Under our more disciplined approach, we intend to invest capital in future node development and new or upgraded manufacturing facilities only where we have a clear line of sight to an acceptable return on that capital.
We recently released our first products manufactured on our new leading-edge node, Intel 18A, and we continue to develop its derivative node, Intel 18A-P, designed for future Intel products and external Intel Foundry customers. We are focused and have made substantial progress in recent periods on the continued development of Intel 14A, the next generation node beyond Intel 18A and Intel 18A-P, and on meeting design milestones towards securing potential significant customers for future products utilizing the node. In addition, our Intel products roadmap now includes a number of future products that are being designed to utilize Intel 14A.
However, if we are unable to secure sufficient committed demand for Intel 14A through product design wins with potential significant external customers and our Intel products roadmap, we face the prospect that it will not be economical to develop and manufacture Intel 14A and successor leading-edge nodes on a go-forward basis. In such event, we may pause or discontinue our pursuit of Intel 14A and successor nodes and various of our manufacturing expansion projects. If we were to discontinue development of Intel 14A and successor nodes, we expect that a majority of our products would continue to be manufactured in our own facilities utilizing our nodes up to Intel 18A-P through at least 2030, but would shift to reliance on an external foundry for future Intel products requiring nodes with performance beyond Intel 18A and Intel 18A-P. By focusing on our customers and delivering the best semiconductor products to the market, manufactured on the most appropriate internal or external node from a performance and cost perspective, and only deploying capital on new nodes and manufacturing facilities where we believe they will yield an attractive return, we believe we can improve the competitiveness of our products business, and the overall financial results for the company.
Risks from the Conflict with Iran
On February 28, 2026, the U.S. and Israel initiated coordinated military strikes against Iran, which were followed by retaliatory actions by Iran and Iran‑aligned groups, including missile and drone attacks directed at Israel and other countries in the region. Since that time, the conflict has continued to escalate, with strikes by the U.S. and Israel against targets in Iran, strikes by Israel against targets in Lebanon and strikes by Iran and Iran-aligned groups against military, civilian and industrial targets in Israel and other countries in the region, including Kuwait, Saudi Arabia, Bahrain, Qatar, the United Arab Emirates, Oman, Iraq, Jordan, Syria, Lebanon, Cyprus and Azerbaijan. Iran's strikes against industrial targets, including oil and natural gas fields, and closing of the Strait of Hormuz, have significantly disrupted various global supply chains. Among other things, the conflict has resulted in increased global energy prices and energy shortages that may adversely impact the world economy. In addition, Iranian strikes on two energy fields in Qatar that supply a meaningful percentage of the world supply of helium have resulted in a global shortage of this gas that is essential to the semiconductor manufacturing process.
In late March 2026, Iran published a list of U.S. companies with operations in the Middle East whose facilities they indicated they would target in retaliation for continued strikes on Iran, with Intel being near the top of that list. A significant portion of our revenues are generated from products on Intel 7 manufactured at our fabrication facility in Israel. As we are not insured for business interruptions resulting from war or political violence, a disruption of that facility could have a significant adverse impact on our business. We could also be adversely impacted by disruptions to our product development centers in Israel. As our property, plant and equipment assets in Israel are self‑insured for losses resulting from war or political violence, any significant impact from the conflict, especially to our fabrication facility, could have a material adverse effect on our consolidated financial results and position.
We continue to monitor the potential impact this conflict could have on our operations in Israel, on our global operations and business and on the semiconductor industry and global economy more broadly.
Goodwill Impairment
Our Q1 2026 operating results were significantly impacted by the recognition of $3.9 billion of non-cash goodwill impairment charges within restructuring and other charges in our Consolidated Condensed Statements of Operations , substantially all of which related to impairing the goodwill of our Mobileye reporting unit.