Chipmaker Intel posted an operating loss of $7 billion in 2023, up nearly $2 billion from the previous year.

Intel made an operating loss of $7 billion in fiscal 2023, an increase of nearly $2 billion compared to its 2022 loss. According to the company, these operating losses are the result of poor decisions made in the past, but hopes that ASML investments in extreme ultraviolet (EUV) machines will reach breakeven in 2027.

Wrong decisions

CEO Pat Gelsinger said during a presentation to investors that 2024 will be the worst year of operating losses for the company’s chipmaking business and that the company is expected to break even operationally around 2027, Reuters reports. The loss is the result of previous mistakes by Intel, such as outsourcing 30 percent of its total chip production to third-party manufacturers such as TSMC, which is now a major competitor to Intel.

Intel is currently investing in the use of extreme ultraviolet (EUV) machines from Dutch company ASML, something the company says it should have done sooner. The prices of these machines can go up to $150 million, but in the long run they are more cost-effective compared to other tools. The Intel CEO believes the cost-effectiveness of these tools will help the company break even by 2027. The company had revenue of $18.9 billion in 2023, although that number fell 31 percent compared to the previous year.