Key Points:

• Intel (NASDAQ: INTC) is losing market share in main markets to AMD (NASDAQ: AMD) and missing the AI chip potential dominated by NVIDIA (NASDAQ: NVDA)
• With only 5 out of 29 analysts keeping “buy” ratings and the company unable to pivot properly despite AI’s ascent, leadership and strategic errors have caused Wall Street to lose faith.
• Emerging in-house AI chip development by mega-cap tech businesses like Amazon (NASDAQ: AMZN) are a possible threat to NVIDIA
• Also: As the tide may turn for Nvidia, it’s time to look at ‘The Next Nvidia’ stocks to be the biggest winners of 2025.

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Transcript:

[00:00:00] Douglas McIntyre: Right. So we have Intel,

[00:00:02] Lee Jackson: We do.

[00:00:02] Douglas McIntyre: Really gone from bad to worse. I mean, I can’t imagine a bigger train wreck because you remember even five years ago, Intel was the premier chip company in the world.

[00:00:16] Lee Jackson: They were.

[00:00:18] Douglas McIntyre: So explain to me how it blew up.

[00:00:23] Lee Jackson: Well, I mean, when they brought the guy that is quote resigning as a guy named Pat Geltinger, when he was brought in two or three years ago, he was like, this is the guy. This is the guy that can fix it all because he had a big tech background and you know, he was really the one that was going to get everything back on track and nothing’s gotten back on track.

[00:00:44] Lee Jackson: and basically now Wall Street’s given up there. You know, they used to have by ratings across the board. I think of the 29 people that cover them, they have five by ratings and most people have just totally thrown in the towel because everything’s a mess.

[00:00:59] Douglas McIntyre: What happens? I listen, it’s the sort of thing where I don’t even understand why any other chip company would buy them.

[00:01:07] Lee Jackson: I don’t know what they’re gonna do. I mean, you know, they added two people to the board to start with their search for the Gelsinger replacement, but to be frank with you, who’s going to take that job? Some high level NVIDIA guy or a high level guy or gal at AMD? I don’t think so. Why would they?

[00:01:26] Douglas McIntyre: I mean, look, you’d have to get somebody that you would guarantee like 50 million, no matter

[00:01:33] Lee Jackson: It would have to be huge. Yeah.

[00:01:35] Douglas McIntyre: But this to me is an example of what you do see in business all too often. You own a franchise. Now there was a guy named Andy Grove, who was the CEO of Intel over a

[00:01:47] Lee Jackson: Remember the great Andy Grove?

[00:01:49] Douglas McIntyre: And Andy Grove said the most important that you could have a seat as a CEO was paranoia. He coined that phrase in terms of a way to look at a business as a CEO and paranoia map looking over your back see who was coming up

[00:02:09] Lee Jackson: Yeah.

[00:02:09] Douglas McIntyre: you. These guys completely forgot that mantra. They just, they let it go. I mean, NVIDIA was not a big company five years ago. It just wasn’t.

[00:02:21] Douglas McIntyre: a They were good, they were a graphic chip company and the, the race for AI chips in many ways, because of Intel’s balance sheet and customer base that race was theirs to lose.

[00:02:37] Lee Jackson: It absolutely was a five, seven years ago, the stock was 11. And, you know, they stayed in business simply because they had a gaming chip that made all the graphics for gaming better. And, you know, gaming was the next. New world for growth before AI and you know They took the some of the data and they and the people they had that helped do those GPUs and that came hit the home run and What I find really astonishing Isn’t there a point?

[00:03:10] Lee Jackson: Two years ago or three years ago when people got the sense that AI could be a big play What were the Intel people doing in the in the C suite because they missed it.

[00:03:21] Douglas McIntyre: Well, it’s, I mean, I, I don’t want to beat a dead horse here, but ultimately it’s the board’s fault that they didn’t change this fast enough.

[00:03:32] Lee Jackson: Yeah.

[00:03:33] Douglas McIntyre: I mean, I won’t buy this stock. Let’s just put it that way. To me, stock is a sell and it could be a sell, even if it drops another or 30%. I don’t see anybody riding to the rescue.

[00:03:49] Lee Jackson: No,

[00:03:50] Douglas McIntyre: any

[00:03:50] Lee Jackson: no,

[00:03:51] Douglas McIntyre: who can this. They are boxed out of the most important part of the chip market. And what’s interesting is if you look at AI chips, Amazon and several other tech companies don’t want to use Nvidia chips, right? They don’t want to be. They don’t want to be captive. So you now have these

[00:04:12] Lee Jackson: they don’t want to be beholden to them. Absolutely.

[00:04:15] Douglas McIntyre: what’s happening is, is if, if you said to me, at what point Nvidia become a cell? It’s not AMD and it’s obviously not Intel.

[00:04:27] Lee Jackson: No.

[00:04:28] Douglas McIntyre: it’s these other companies like Amazon that are going to build their own ship. It’s not a question

[00:04:33] Lee Jackson: Right.

[00:04:34] Douglas McIntyre: They will build a chip. Does it get a lot of market share outside of, their own companies? I don’t know. But the threat to Nvidia is tech companies that have big AI platforms that want their own chips.

[00:04:49] Douglas McIntyre: So that

[00:04:50] Lee Jackson: Yeah. Absolutely. Yeah.

[00:04:52] Douglas McIntyre: the day you find out that one of the chips that like Amazon is making is awesome. That’s the day you should sell Nvidia.

[00:04:59] Lee Jackson: Yeah. Yeah. You know, one final interesting tidbit on Intel, you know, for years, at least they could count on being the go to process. I mean, on, on, on the, Laptop, I’m on. It says, you know, you know, Intel chip inside core 15

[00:05:16] Douglas McIntyre: I got

[00:05:16] Lee Jackson: and yours probably does as well, but they’re starting to lose that business. You know, they’re they’re old, you know, pick and shovels business.

[00:05:25] Lee Jackson: They’re starting to lose that to AMD and and PC makers and laptop makers. They’re going to go into AMD for those chips. And if that goes away, they’re doomed. They’re a single digit mission.

[00:05:37] Douglas McIntyre: Yeah. Look, if you’re a, if you’re an investor, Intel is still a dog. And to me, threat to Nvidia is. AI chips from the other mega cap tech companies that want to make sure that NVIDIA can’t make enough chips or for some reason NVIDIA decides to change its price,

[00:06:02] Lee Jackson: Yeah, well,

[00:06:03] Lee Jackson: Intel’s doomed either way, so, you know, I wouldn’t be long in the stock. I’d probably be shorted if I was shorting stocks.

[00:06:11] Douglas McIntyre: Okay. Intel’s a dog. Keep an eye, watch NVIDIA and watch whether it’s not chip companies. But tech, tech companies that use its chips, if they move into the market and you’re in NVIDIA, that’s the time to think about whether you hold it or not.

[00:06:29] Lee Jackson: Yeah, we’re gonna keep a close eye on that.

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