Intel (NASDAQ: INTC) investors had reason to celebrate on Thursday as the chip stock experienced a modest uptick in afternoon trading. This positive movement followed the announcement that Intel would be streamlining its chip lineup by discontinuing several models. While this decision may seem surprising at first glance, it aligns with Intel’s strategy to focus its marketing efforts on a select few models while preparing to introduce new ones.
Intel disclosed that it would be discontinuing its 13th-generation K-series CPUs, specifically the i5, i7, and i9 models, before May 24, 2024. These chips, formerly part of the Raptor Lake lineup, will no longer be produced, with final shipments scheduled to cease by June 28, 2024. Although existing inventory may remain available for a period, it’s expected to gradually diminish as the discontinuation date approaches.
Interestingly, while Raptor Lake chips are being phased out, reports indicate that Intel plans to continue offering the older Alder Lake line. This decision raises questions about why Intel would maintain an older product line while discontinuing a newer one. Some analysts speculate about potential market dynamics or strategic considerations behind this move, but the rationale remains unclear for now.
Looking ahead, investors and industry observers are eager to see what Intel has in store to replace the outgoing Raptor Lake chips. Insights gleaned from the recent Intel Vision event, where Supermicro showcased servers equipped with Intel Xeon 6 chips, offer a glimpse into the company’s future direction. Impressively, Supermicro’s servers featuring the new Gaudi 3 system—a recent innovation from Intel—were met with positive reviews. Additionally, the integration of Intel’s DC-MHS standard into Supermicro’s servers suggests broader adoption of Intel’s technology within the ecosystem.
As investors weigh their options, Wall Street analysts maintain a Hold consensus rating on INTC stock. This rating is based on a combination of five Buy, 24 Hold, and four Sell recommendations over the past three months. Despite a 19.08% increase in its share price over the past year, the average price target for INTC stands at $45.05 per share, implying a potential upside of 20.09%.