Intel Corp. has been suffering from credit rating downgrades in recent years as its profits deteriorated, but on Monday bond investors signaled they are buying into the company’s turnaround story.
The chipmaker attracted about $50 billion of orders for a $6.5 billion bond sale, according to people with knowledge of the matter. Proceeds of the offering will help Intel buy back a in an Irish chip plant that it had sold off.
Intel has been trying to win back its technological edge after suffering from market share losses for its computer chips for years. It saw its credit ratings slip to the BBB tier, a few steps above junk, from the A tier.
In 2025, the US government acquired a stake as part of an unconventional White House-brokered deal. Last week, Intel signaled it’s making progress in fixing itself, delivering a sales forecast that shattered Wall Street’s expectations. Investors are growing more optimistic that it is finally seizing on a surge in artificial intelligence spending. Shares have hit record highs.
Monday’s bond sale had been in the works for some time, but the positive results helped with momentum for this deal, according to a person with knowledge of the sale. The bonds priced at somewhere between 0 and 0.05 percentage point wider than Intel’s existing debt, a relatively low concession signaling relatively strong demand. The deal garnered orders equal to about 7.7 times the bonds for sale, compared with an average for deals this year of closer to about 4 times.
Investors’ growing hope in Intel’s turnaround is also evident in the credit derivatives market, where the of protecting the company’s debt against default has dropped this month: it was around 0.6 percentage point a year for five years on Monday, compared with about 0.85 percentage point in late March.
Citigroup Inc., JPMorgan Chase & Co., Barclays Plc, Bank of America Corp. and Deutsche Bank AG ran the bond offering. Representatives for Intel and for the banks either declined or did not immediately respond to requests for comment.
The need for data centre chips to power the massive AI expansion is lifting demand for Intel’s flagship Xeon server processors. That type of generalist semiconductor — the central processing unit, or CPU — is a renewed focus for companies trying to turn their AI software into services that bring in revenue.
Proceeds from the bond offering will help Intel fund its $14.2 billion repurchase of a 49 per cent stake in its Fab 34 joint venture in Ireland from Apollo Global Management Inc. The private equity firm paid $11.2 billion for the stake in 2024, providing cash that Intel said it needed for new production technology at the facility and others in the US.
Intel had most recently sold dollar notes in February 2024, according to data compiled by Bloomberg. Its foundry joint venture with Brookfield Infrastructure Partners raised nearly $12 billion through three offerings in 2024 and 2025.
The longest-term note in Monday’s five-part offering, due in 2066, yielded 1.3 percentage points more than Treasuries, about 0.35 percentage point tighter than initial price talk, a person said. The issuance was the largest among 12 high-grade offerings and part of an active session in US debt-capital markets on Monday.
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