Intel stock jumped 10% because the president said Apple might let them draw some rectangles on a napkin. That's the deal. A "partnership" in chip design, which could mean anything from full collaboration to Tim Cook returning one of Trump's phone calls.
The announcement contains zero specifics. No timeline. No contract. No confirmation from Apple. Just Trump saying two company names in the same sentence and the market deciding that's worth $15 billion in market cap. Analysts are calling it a major turnaround for Intel. Analysts also said Intel would dominate mobile chips in 2014.
Intel spent the last five years losing manufacturing supremacy to TSMC, hemorrhaging market share to AMD, and canceling so many product launches their roadmap looks like a game of Minesweeper. Now they're bouncing back because of a press conference. Not because they fixed their 18A process node. Not because they shipped competitive GPUs. Because a guy spoke words.
Retail traders saw the headline and bought immediately, which makes sense if you've never heard Intel promise a partnership before. They partnered with Micron on 3D XPoint memory. That died. They partnered with Chinese firms on mobile chips. That died. They partnered with the concept of competent execution for three decades and that's on life support.
Apple designs their own chips and has TSMC manufacture them with yields Intel can't touch. The idea that Apple needs Intel for "design" is like hiring a swim coach who's actively drowning. But the chart went up, so someone's getting a promotion.
The technical setup doesn't care about partnerships. It cares that Intel found resistance at $23 and support at $19 for six weeks while carving out a range tighter than Trump's immigration policy. The breakout happened on volume. That matters. The reason for the breakout is a soundbite. That doesn't.
You bought the rip because the president mentioned a fruit company. Intel thanks you for your sacrifice.
Photo by on Unsplash
Leave a Comment