Other People's CapitalNarrow moat

Intel (INTC) — moat facet

Washington, Nvidia, SoftBank and two private equity firms paid to keep Intel's factories running, and ordinary shareholders paid for it in dilution.

Intel's third source of strength is not a technology but a set of backers. Between 2024 and 2026 it raised money from almost everyone with a reason to want an American chipmaker to survive. The United States government bought 433.3 million shares at $20.471. Nvidia bought 215 million shares at $23.28 for $5.0 billion2. SoftBank bought 87 million shares at $23.00 for $2.0 billion3. Apollo paid $11.0 billion for half of the Irish factory4, and Brookfield owns 49% of the Arizona one5.

Capital from backers ($bn)Apollo, Ireland stake 202411.0US government, 20258.9Nvidia, 20255.0SoftBank, 20252.0Intel Form 10-K FY2025; government figure is CHIPS and Secure Enclave funds
About $27 billion of outside money in two years.

That capital bought time. Intel's adjusted free cash flow was negative $2,228 million in 2024 and negative $1,612 million in 20256, and it suspended its dividend from the fourth quarter of 20247. The backers covered the gap.

It also came with conditions. The government's warrants make it costly to separate the factories8. The CHIPS agreement prohibits dividends for two years9. Partners take a share of the plants' profits, guided at about $1.1 billion a year in 2027 and 202810. And Intel's share count rose from 4,090 million diluted in 2021 to 4,530 million in 20251112, as new shares were sold rather than bought back.

The most unusual cost appeared in 2026. Shares held in escrow for the government are accounted for as a derivative, and as Intel's share price rose their fair value climbed to $15.6 billion13, producing a $12.5 billion mark-to-market loss in the second quarter14 and a net loss attributable to Intel of $11,033 million15.

SoftBank's purchase completed the set. It bought 87 million shares at $23.00, $2.0 billion, completed on 26 September 202516. At $127.39 a share17, those shares and Nvidia's are worth several times what their buyers paid, which says the backers bought at the bottom. It also says that Intel sold equity at the bottom, which is the cost ordinary shareholders bore.

This is a narrow advantage: strategic backers who will not let the factories fail. It is also the reason ordinary shareholders have been diluted rather than paid. The sign that the backing has become a business is adjusted free cash flow turning positive for a full year, which it has not been since 2021.

Moat trajectory: Holding steady

The backers are in place; the cost shows in dilution, partner payouts and escrow losses.

The number that tests this moat
Reported
Adjusted free cash flow, full year
Negative $1,612M (2025); negative $2,228M in 2024

Whether the business funds itself; a positive full year would mean the backers' capital is no longer needed to fill the gap.

Source: Intel FY2025 results release ↗
Aspects of the moat
DIG DEEPER 01
Washington's 433 Million Shares
The US government owns 8.4% of Intel, bought with the subsidies it had already promised, which makes the factories harder to close and the…
DIG DEEPER 02
The Warrant That Keeps the Foundry Inside Intel
If Intel ever gives up control of its factories, Washington can buy 241 million more shares at $20, which makes a split all but impossible.
DIG DEEPER 03
Apollo: Sold for $11.0 Billion, Bought Back for $14.2
Intel sold half of its Irish factory to Apollo for $11.0 billion in 2024 and paid $14.2 billion to buy it back in 2026.
DIG DEEPER 04
Selling the Pieces: Altera, Mobileye and NAND
Intel sold half of Altera and more of Mobileye to fund its factories, and still wrote down Mobileye by $3.9 billion.
⚠ Threats to the moat
⚠ THREAT 01
The Escrow That Turned a Rally Into an $11 Billion Loss
Intel lost $11 billion in the second quarter of 2026 on paper because its share price rose.
⚠ THREAT 02
Shareholders Diluted, Not Paid
Intel has not paid a dividend since 2024 or bought back a share since 2021, and has about a quarter more shares than it did then.
References
  1. ReportedThe United States government bought 433.3 million shares at $20.47.
    Intel press release, Intel and Trump Administration reach historic agreement - 433.3 million primary shares at $20.47, passive ownership with no board representation. — August 2025 · publ. 22 August 2025 · source ↗
  2. ReportedNvidia bought 215 million shares at $23.28 for $5.0 billion.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - financial statements and notes: results, capital, government and partner transactions, restructuring and tax. — FY2025 · publ. 23 January 2026 · source ↗
  3. ReportedSoftBank bought 87 million shares at $23.00 for $2.0 billion.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - financial statements and notes: results, capital, government and partner transactions, restructuring and tax. — FY2025 · publ. 23 January 2026 · source ↗
  4. ReportedApollo paid $11.0 billion for half of the Irish factory, and Brookfield owns 49% of the Arizona one.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - financial statements and notes: results, capital, government and partner transactions, restructuring and tax. — FY2025 · publ. 23 January 2026 · source ↗
  5. ReportedApollo paid $11.0 billion for half of the Irish factory, and Brookfield owns 49% of the Arizona one.
    Intel Form 10-Q for the quarter ended 27 June 2026 - segments, the Ireland SCIP repurchase, escrowed shares, Intel 14A, customer deposits and debt. — Q2 2026 · publ. 24 July 2026 · source ↗
  6. ReportedIntel's adjusted free cash flow was negative $2,228 million in 2024 and negative $1,612 million in 2025, and it suspended its dividend from the fourth quarter of 2024.
    Intel fourth-quarter and full-year 2025 results release, Form 8-K exhibit 99.1 - statements, capital spending and adjusted free cash flow. — FY2025 · publ. 22 January 2026 · source ↗
  7. ReportedIntel's adjusted free cash flow was negative $2,228 million in 2024 and negative $1,612 million in 2025, and it suspended its dividend from the fourth quarter of 2024.
    Intel Form 10-K for fiscal 2024 - the 2024 restructuring, dividend suspension, goodwill impairment and headcount. — FY2024 · publ. January 2025 · source ↗
  8. ReportedThe government's warrants make it costly to separate the factories.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - financial statements and notes: results, capital, government and partner transactions, restructuring and tax. — FY2025 · publ. 23 January 2026 · source ↗
  9. ReportedThe CHIPS agreement prohibits dividends for two years.
    Intel Form 10-K for fiscal 2024 - the 2024 restructuring, dividend suspension, goodwill impairment and headcount. — FY2024 · publ. January 2025 · source ↗
  10. ReportedPartners take a share of the plants' profits, guided at about $1.1 billion a year in 2027 and 2028.
    Intel Q2 2026 earnings call prepared remarks (CEO and CFO). — Q2 2026 · publ. 23 July 2026 · source ↗
  11. ReportedAnd Intel's share count rose from 4,090 million diluted in 2021 to 4,530 million in 2025, as new shares were sold rather than bought back.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - financial statements and notes: results, capital, government and partner transactions, restructuring and tax. — FY2025 · publ. 23 January 2026 · source ↗
  12. Moat Explorer calcAnd Intel's share count rose from 4,090 million diluted in 2021 to 4,530 million in 2025, as new shares were sold rather than bought back.
    Moat Explorer calculation from Intel's reported figures ($ millions unless stated). Segment margins 2025: Client Computing 9,317 / 32,228 = 28.9% (2024: 11,594 / 33,346 = 34.8%; Q2 2026: 2,343 / 8,877 = 26.4%); Data Center and AI 945 / 15,980 = 5.9% (2023), 1,414 / 16,125 = 8.8% (2024), 3,422 / 16,919 = 20.2% (2025), 2,474 / 6,262 = 39.5% (Q2 2026); Intel Products 12,739 / 49,147 = 25.9%. Revenue shares 2025: client 32,228 / 52,853 = 61.0%; data center 16,919 / 52,853 = 32.0%; together 49,147 / 52,853 = 93.0%. Client growth Q2 2026: 8,877 / 7,871 - 1 = 12.8%. Foundry: internal revenue 17,826 - 307 = 17,519, 17,519 / 17,826 = 98.3%; external share 307 / 17,826 = 1.7%; operating losses 7,083 + 13,291 + 10,318 = 30,692. Intel share of x86 server revenue Q1 2026: 100 - 46.2 = 53.8%. Revenue 2025 against 2021: 52,853 / 79,024 - 1 = -33.1%. Headcount 82.3 / 124.8 - 1 = -34%. Government stake 433.3M x $127.39 = about 55.2 bn; purchase funds 5.7 + 3.2 = 8.9 bn. Warrants 241M x (127.39 - 20.00) = about 25.9 bn. Nvidia stake 215M x 127.39 = about 27.4 bn; 215 / 4,994 = 4.3%. Backers 11.0 + 8.9 + 5.0 + 2.0 = 26.9 bn. Apollo 14.2 - 11.0 = 3.2 bn. Mobileye 100% - 23% = 77%. Net debt end-2025: (2,499 + 44,086) - (14,265 + 23,151) = 46,585 - 37,416 = 9,169; 27 June 2026: (1,988 + 48,549) - (12,874 + 16,853) = 50,537 - 29,727 = 20,810. Shares: diluted 4,530 / 4,090 - 1 = 10.8% (2021-2025); outstanding June 2026 5,043 against 4,090 diluted in 2021 = 23% more. China share of revenue 12,694 / 52,853 = 24.0% (2025); 15,532 / 53,101 = 29.2% (2024); China 12,694 / 22,961 - 1 = -44.7% (2021-2025). Gross margin 43,815 / 79,024 = 55.4% (2021); 21,711 / 54,228 = 40.0% (2023). R&D 16,546 - 13,774 = 2,772; R&D share of revenue 13,774 / 52,853 = 26.1% (2025), 16,546 / 53,101 = 31.2% (2024). Operating cash flow to gross capital spending 9,697 / 17,672 = 0.55. All Other external revenue: 54,228 - 32,305 - 15,980 - 547 = 5,396 (2023); 53,101 - 33,346 - 16,125 - 159 = 3,471 (2024); 52,853 - 32,228 - 16,919 - 307 = 3,399 (2025). Trailing EPS to June 2026: -0.06 - (-0.19 - 0.67) + (-0.73 - 2.16) = -2.09. Market value 669.37 / 86.48 = 7.7 times end-2024; share price 127.39 / 29.23 = 4.4 times the 52-week low - capital, ownership and valuation. — 2015-2026 · publ. September 2026 · source ↗
    Method: Arithmetic on figures reported in Intel's Forms 10-K, 10-Q, results releases, prepared remarks and market data; operands shown in the source line.
  13. ReportedShares held in escrow for the government are accounted for as a derivative, and as Intel's share price rose their fair value climbed to $15.6 billion, producing a $12.5 billion mark-to-market loss in the second quarter and a net loss attributable to Intel of $11,033 million.
    Intel Form 10-Q for the quarter ended 27 June 2026 - segments, the Ireland SCIP repurchase, escrowed shares, Intel 14A, customer deposits and debt. — Q2 2026 · publ. 24 July 2026 · source ↗
  14. ReportedShares held in escrow for the government are accounted for as a derivative, and as Intel's share price rose their fair value climbed to $15.6 billion, producing a $12.5 billion mark-to-market loss in the second quarter and a net loss attributable to Intel of $11,033 million.
    Intel second-quarter 2026 results release, Form 8-K exhibit 99.1. — Q2 2026 · publ. 23 July 2026 · source ↗
  15. ReportedShares held in escrow for the government are accounted for as a derivative, and as Intel's share price rose their fair value climbed to $15.6 billion, producing a $12.5 billion mark-to-market loss in the second quarter and a net loss attributable to Intel of $11,033 million.
    Intel second-quarter 2026 results release, Form 8-K exhibit 99.1. — Q2 2026 · publ. 23 July 2026 · source ↗
  16. ReportedIt bought 87 million shares at $23.00, $2.0 billion, completed on 26 September 2025.
    Intel Form 10-K for fiscal 2025 (year ended 27 December 2025) - financial statements and notes: results, capital, government and partner transactions, restructuring and tax. — FY2025 · publ. 23 January 2026 · source ↗
  17. ReportedAt $127.39 a share, those shares and Nvidia's are worth several times what their buyers paid, which says the backers bought at the bottom.
    Intel (INTC) market data - $127.39 a share at the close on 24 September 2026, market cap $669.37B, 52-week range 29.23-142.35, analyst target $116.37. — September 2026 · publ. 24 September 2026 · source ↗
Sources
Generated September 25, 2026