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Intel held its Q1 2025 earnings call on Thursday. According to Reuters, attention centered on the disclosure that CEO Lip-Bu Tan had recently met with TSMC CEO C.C. Wei and former chairman Morris Chang, as well as on the impact of trade uncertainties on Intel’s outlook.
As highlighted by Reuters, Tan said he met with TSMC CEO C.C. Wei and founder Morris Chang to explore potential areas of collaboration and to “create a win-win situation.” Wei was in Silicon Valley this week for TSMC’s annual technology conference, which Tan also attended, according to two Reuters sources who observed him at the event.
Tariff Uncertainty Clouds Forecast
The company also addressed the influence of tariffs during its earnings call. Citing CFO David Zinsner, the report indicates that tariff-related fears led customers to build up inventories of Intel chips, boosting first-quarter sales. However, Intel was unable to quantify the benefit and expects a weaker performance in the second quarter as a result.
Zinsner added that uncertainty surrounding global trade policies, along with growing regulatory risks, has increased the likelihood of an economic slowdown and potential recession—making it difficult to forecast Intel’s performance for both the quarter and the full year, Reuters notes.
Intel expects USD 11.2 billion to USD 12.4 billion in revenue this quarter — a wider-than-usual range. CFO Zinsner points to tariff turmoil as the reason behind the extra wiggle room, as per CNBC.
Meanwhile, in an April notice, the state-backed China Semiconductor Industry Association stated that U.S.-made chips could face tariffs of 85% or higher. China imports approximately USD 10 billion worth of chips from the U.S. each year, with about USD 8 billion consisting of Intel-assembled CPUs, according to analysts cited by Reuters.
Tariffs Shift Demand Toward Older Chips, Undermine AI PC Outlook
According to MoneyDJ, citing Reuters, the U.S.-China trade war is unexpectedly boosting demand for Intel’s older PC and server chips. Intel executives noted that economic uncertainty and rising costs from global tariffs are prompting customers to turn to more affordable, previous-generation processors.
Notably, Intel said it is currently facing a capacity shortage for its ‘Intel 7’ process node—a constraint the company expects to persist for the foreseeable future, according to Tom’s Hardware. In line with this trend, Intel indicated that customers are increasingly choosing lower-cost, previous-generation Raptor Lake chips over its next-generation AI PC chips for laptops, including Lunar Lake and Meteor Lake, as also highlighted by Tom’s Hardware.
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(Photo credit: Intel)
