Intel Drops on $15 Billion Stock Offering. Why It’s Raising Funds Now.

Intel is investing heavily in chip-manufacturing equipment. (Courtesy Intel Corporation)

Key Points

• Intel shares fell early Monday after the company announced plans to raise $15 billion through a stock offering.
• Intel raised its 2026 capital expenditure estimates to more than $20 billion from around $18 billion to meet rising demand.
• Intel is investing in chip-manufacturing processes to attract outside customers and offset quarterly losses in its foundry unit.

Intel stock was falling early Monday after the company said it would raise $15 billion in a stock offering. It’s a reminder that the chip maker’s expansion of production to meet demand comes with a hefty price tag.

The shares were down 3.3% at $98.30 after it filed an S-3 shelf registration related to the offer, which allows companies to register securities with the SEC in advance without having to sell them immediately. The company said it expects to grant a 30-day option for its underwriters to purchase up to an additional $2.25 billion worth of shares at the public offering price, which is yet to be confirmed.

The move shouldn’t come as much of a shock. Intel management said in its recent earnings call that they were raising their 2026 capital expenditure estimates to more than $20 billion, up from around $18 billion, as the company works to meet the rising demand of its products.

The company’s free cash flow is expected to be modestly negative this year, according to FactSet and was a cumulative negative $44 billion between 2022 and 2025. However, it is investing heavily amid hopes that its current 18A and future 14A chip-manufacturing processes can attract outside customers and therefore offset the billions of dollars’ worth of quarterly losses it is booking in its foundry unit.

“Customers continue to signal a strong and sustainable demand environment, driven by unprecedented investment in AI compute,” Intel said in a statement Monday. “Progress in emerging areas including physical AI, purpose-built silicon, advanced packaging and external wafers represent significant growth opportunities for Intel.”

The stock was one of Barron’s picks for 2026 and is up more than 175% this year through Friday’s close, although it has dropped 21% in the past three months.

Write to Adam Clark at adam.clark@barrons.com

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