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Intel Corporation (NASDAQ: INTC ) Q4 2022 Earnings Call Transcript January 26, 2023

Operator: Thank you for standing by, and welcome to Intel Corporation's Fourth Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Mr. John Pitzer, Corporate Vice President of Investor Relations. Please go ahead, sir.

John Pitzer: Thank you, Jonathan. By now, you should have received a copy of the Q4 earnings release and earnings presentation, both of which are available on our investor website, intc.com. For those joining us online today, the earnings presentation is also available in our webcast window. I am joined today by our CEO, Pat Gelsinger; and our CFO, David Zinsner. In a moment, we will hear brief comments from both followed by a Q&A session. Before we begin, please note that today's discussion does contain forward-looking statements based on the environment as we currently see it. As such, it does involve risks and uncertainties. Our press release provides more information on the specific risk factors that could cause actual results to differ materially.

We've also provided both GAAP and non-GAAP financial measures this quarter, and we will be speaking to the non-GAAP financial measures when describing our consolidated results. The earnings release and earnings presentation include full GAAP and non-GAAP reconciliation. With that, let me turn things over to Pat.

Pat Gelsinger: Thank you, John, and good afternoon, everyone. Q4 revenue came in at the low end of guide and was impacted by persistent macro headwinds, which began in Q2 and underscored a 2022 characterized by unprecedented volatility, which will continue in the near term. We made meaningful progress on several fronts in calendar year 2022, notwithstanding all the challenges, but we readily admit our results and our Q1 guidance are below what we expect of ourselves. We are working diligently to address the challenges brought on by current demand trends and remain confident in our long-term plans and trajectory. Accordingly, we are even more aggressively executing on the cost measures we described in Q3, even as we keep the investments critical to our long-term transformation intact with a clear eye of making the right capital allocation decision to drive the most long-term value.

Today, I'd like to address three areas. One, our view on the macro and the markets in which we participate; two, the operational progress we made in 2022; three, as we enter the New Year outlining the commitments we are making to all our stakeholders. First, on the macro. We expect macro weakness to persist at least through the first half of the year with the possibility of second half improvements. However, given the uncertainty in the current environment, we are not going to provide revenue guidance beyond Q1. Dave will provide guidelines for capital spending, depreciation and adjusted free cash flow in his prepared comments. Having said that, let me give you additional color regarding our view of our markets in 2023. To various degrees, all our markets are being impacted by macro uncertainty, rising interest rates, geopolitical tensions in Europe and COVID impacts in Asia, especially in China.

In the PC market, we saw a further deterioration as we ended calendar year 2022. In Q3, we provided an estimate for the calendar year 2023 PC consumption TAM of 270 million to 295 million units. Given continued uncertainty and demand signals we see in Q1, we expect the lower end of that range is a more likely outcome. Near term, the PC ecosystem continues to deplete inventory. For all of calendar year 2022, our sell-in was roughly 10% below consumption with Q4 under shipping meaningfully higher than full year, and Q1 expected to grow again to represent the most significant inventory digestion in our data set. While we know this dynamic will need to reverse, predicting one is difficult. Importantly, PC usage data remains strong, reinforcing that use cases brought on by COVID are persistent even as the economy has reopened.

And as we highlighted in our recent PC webinar, strong usage and installed base, which is roughly 10% higher than pre-COVID levels and what we see as a conservative refresh rate supports a longer term PC TAM of 300 million units plus or minus, post this period of adjustment. We intend to capitalize on this TAM through a strong pipeline of innovation and based on the growing strength of our product portfolio, customers are increasingly betting on Intel. We grew share in the second half of 2022, and we expect that positive momentum to continue in 2023. We remain clear eyed on managing to near-term weakness in PCs but we also see the enduring and increasing value PCs have in our daily lives. In the server market, the overall consumption TAM grew modestly in calendar year 2022, albeit at diminishing rates as the year progressed.

Inventory burn drove server CPU shipments down mid-single digits year-on-year in calendar year 2022 with hyperscale up, offset by declines in enterprise and Rest of World. Our share in calendar year 2022 was in line with our subdued expectations, and our revenue volatility was a function of TAM, especially given our outsized exposure to enterprise and China. We expect Q1 server consumption TAM to decline both sequentially and year-over-year at an accelerated rate with first half 2023 server consumption TAM down year-on-year before returning to growth in the second half. While all segments have weakened, enterprise and rest of world, especially China, continues to be weaker than hyperscale. However, we'd highlight that the correction in enterprise and rest of the world, where we have stronger positions are further along than hyperscale.

Lastly, in our broad-based markets like industrial, auto and infrastructure, demand trends throughout calendar year 2022 were strong but not completely immune to the macro volatility. Strong demand in these markets was mirrored by strong Q4 and record calendar year 2022 revenue in NEX, PSG, IFS and Mobileye. We see calendar year 2023 as another growth year for us in these areas even though the absolute rate is difficult to predict today. This is in contrast to the semi market ex-memory, which third parties expect to decline low to mid-single digits. We entered 2023 with a view that much of the macro uncertainty of the last year is likely to persist, especially in the first half of the year. As such, we are laser focused on executing to our $3 billion in calendar year 2023 cost savings that we committed on our Q3 earnings call.

We are making tough decisions to rightsize the organization and we further sharpened our business focus within our BUs by rationalizing product road maps and investments. NEX continues to do well and is a core part of our strategic transformation, but we will end future investments in our network switching product line, while still fully supporting existing products and customers. Since my return, we have exited seven businesses, providing in excess of $1.5 billion in savings. We are also well underway to integrating AHG into CCG and DCI, respectively, to drive a more effective go-to-market capability, accelerating the scale of these businesses while further reducing costs. While it was important to focus on what we are doing to address the current macro uncertainty, it is also important to highlight that despite disappointing financial results, calendar year 2022 did see considerable progress towards our transformation.

We remain fully committed to executing to our strategy to deliver leadership products, anchored on open and secure platforms, powered by at-scale manufacturing and supercharged by our people. Success starts with our people and execution follows culture. In calendar year 2022, we took important strides to rebuild the leadership team, promoting from within and adding fresh perspectives from the outside. This includes the Board of Directors, with the addition of Lip-Bu Tan and Barbara Novick, both of whom have already made significant contributions and the appointment of Frank Yeary as Chair. In addition, a year ago, we reestablished OKRs to drive accountability and transparency across the organization, and we reintroduced TikTok 2 to establish a rigorous methodology of design and product development.

Both are key spark plugs to our execution engine. Rebuilding the culture has begun to show benefits in manufacturing and design. Our progress against our TV road map continue to improve throughout calendar year 2022 and every quarter, our confidence grows. We are at/or ahead of our goal of 5 nodes in four years. Intel 7 is now in high-volume manufacturing for both client and server. On Intel 4, we are ready today for manufacturing, and we look forward to the Meteor Lake ramp in second half of the year. Intel 3 continues to show great health and is on track. Intel 4 and 3 are our first modes deploying EUV, and will represent a major step forward in terms of transistor performance per watt and density. On Intel 20A and Intel 18A, the first nodes to benefit from RibbonFETs and PowerVia, internal test chips and those of a major potential foundry customer have taped out with the silicon running in the fab.

We continue to be on track to regain transistor performance and power performance leadership by 2025. Progress in TD continues to be validated by our IFS pipeline. I am happy that we were able to add a leading cloud edge and data center solutions provider as a leading edge customer for Intel 3 including prior customers. Such as MediaTek, we now have lifetime deal value of greater than $4 billion for IFS. We also have an active pipeline engagements with seven out of the 10 largest foundry customers coupled with consistent pipeline growth to include 43 potential customers and ecosystem partner test chips. Additionally, we continue to make progress on Intel 18A, and I've already shared the engineering release of PDK0.5 with our lead customers and expect to have the final production release in the next few weeks.

In addition, we are working hard to complete the Tower acquisition, which will further amplify our momentum as our foundry business becomes even more compelling to customers. On the product front, the PRQ of Sapphire Rapids in Q3 and the formal introduction of our fourth gen Xeon scalable CPU and Xeon CPU MAX series better known to many of you as Sapphire Rapids and Sapphire Rapids HBM, respectively, on January 10 was a great milestone. It was particularly satisfying to host a customer-centered events, including testimonials from Dell, Google Cloud, HPE, Lenovo, Microsoft Azure and NVIDIA, among many others. We are thrilled to be ramping production to meet a strong backlog of demand, and we are on track to ship 1 million units by midyear. In addition, as part of AHG moves into DCAI, it is noteworthy that our Intel Flex series optimized for and showing clear leadership in media stream density and visual quality is now shifting initial deployments with large CSPs and MNCs, enabling large-scale cloud gaming and media delivery deployments.

Our DCAI road map only improves from here and will rapid to sampling and has completed power on with top OEM and CSP customers, and it remains on track to launch in the second half of 2023. Granite Rapids, our next performance core addition to the Xeon portfolio is on track to launch in 2024, running multiple operating systems across many different configurations. Further, our first efficient core product, CFR is also on track for 2024. Lastly, it is appropriate to continue to highlight PSG for its standout performance delivering record Q4 revenue up 42% year-on-year. We are planning to have a more fulsome look at our progress in BCEI at our next investor webinar later in Q1. Stay tuned for the invitation. In CCG, we continue to build on our market share momentum across the PC stack by focusing on delivering leadership products with our broad open ecosystem.

I'm particularly pleased that our clear performance leadership at the high end drove record client ASPs in the quarter. In Q4, the 13th Gen Intel Core desktop processor family, codename, Raptor Lake, became available, starting with the desktop K processors and the Intel Z790 chipset. In partnership with ASUS, we officially set a new world record for overclocking, pushing the 13th Gen Intel Core past the 9 gigahertz barrier for the first time ever. Hands down, we provide desktop enthusiasts and gamers with the best processors and features for overclocking in the PC industry. We also introduced our notebook Raptor Lake family at CES, including the world's fastest notebook CPU and the first 24 cores. We look forward to ramping the more than 300 mobile design wins we have already secured in the first half of 2023.

Meteor Lake, our first disaggregated CPU built on Intel 4, remains on track for the second half of the year. And with Meteor Lake progressing well, it's now appropriate to look forward to Lunar Lake, which is on track for production readiness in 2024, having taped out its first silicon. Lunar Lake is optimized for ultra-low power performance, which will enable more of our PC partners to create ultra-thin and light systems for mobile users. In addition, as we outlined on our webinar, we are excited by the strength of the Evo brand. The introduction of Unison for leadership multi-device experience as we ramp the more than 60 design wins and the uniqueness of vPro in the enterprise market, helping our customers drive an almost 200% return on investment by deploying vPro platforms to their end users.

Lastly, as consumer graphics reintegrate into CCG, enthusiasm for our latest Alchemist-based discrete graphics products continue to build and we expect volume ramp throughout the year. Turning to NEX and Mobileye. Both businesses have performed well in Q4 and calendar year 2022, partially insulated by some of the market forces impacting PCs and server. NEX hit the key product milestones with Mount Evans, Raptor Lake P&S, and Alder Lake and Sapphire Rapids to drive a second consecutive year of double-digit year-on-year growth in calendar year 2022. We expect market share gains and outperformance to continue in 2023. Mobileye increased revenue by almost 60% year-on-year in Q4 and is on a solid growth path for calendar year 2023. Calendar year 2022 design wins, including supervision, are projected to generate future revenue of approximately $6.7 billion across 64 million units.

In addition, our manufacturing organization performed well throughout calendar year 2022. Starting the year, navigating the worst supply-constrained environment in over 20 years, only to have to pivot in Q2 to respond to rapidly changing demand signals, which are now driving near-term under-loading in our factory network. More importantly, we continue to push forward with the next phase of IBM 2.0 creating an internal foundry, evolving our systems business practices and culture to establish a leadership cost structure. This new approach is already gaining momentum internally. As a reminder, the internal foundry model will place our BUs in a similar economic footing as external IFS customers, and will allow our manufacturing group and BUs to be more agile, make better decisions and uncover efficiency and cost savings.

We have identified nine different subcategories for operational improvement that our teams will aggressively pursue. In addition to establishing better incentives, this new approach will provide transparency on our financial execution, allowing us to better benchmark ourselves against other foundries and drive to best-in-class performance. We'll also provide improved transparency to our owners as we expect to share full internal foundry P&L in calendar year 2024. Ultimately, allowing you to better judge how we are allocating your capital and creating value. We expect additional efficiencies as we implement our internal foundry model, which is a key element to accomplish our $8 billion to $10 billion of cost savings exiting 2025, as we outlined on our last call.

I want to remind everyone that, we are on a multi-year journey. We remain focused on the things that are within our control as we navigate short-term headwinds, while executing to our long-term strategy. While I remain sober that, we have a long way to achieve our financial expectations, I am pleased with the transformation progress that we are making. I can tell you, in addition to obviously focusing on the day-to-day running of the company we continue to examine numerous additional value-creating initiatives for 2023 as we always do. We will update you as we move along on any we deem appropriate. Rest assured, we remain committed to creating value for our owners and to delivering the long-term strategic road map we laid out at the beginning of this journey, and we are confident in our ability to do so.

We will, one, deliver on five nodes in four years, achieving process performance parity in 2024 and unquestioned leadership by 2025 with Intel 18A. Two, execute on an aggressive Sapphire Rapids ramp introduced Emerald Rapids in second half 2023 and Granite Rapids and CR4s in 2024. Three, ramp Meteor Lake in second half 2023 and PRQ Lunar Lake in 2024, and four, expand our IFS customer base to include large design wins on Intel 16, Intel 3 and 18A this year. We also need to improve our cost structure and drive operational efficiency. On this front, we will one, return to profitability and deliver the benefits of our calendar year 2023, 2024 and 2025 efforts to reduce costs and drive efficiencies. Two, execute on our internal foundry P&L by 2024.

And three, expand on the use of our smart capital strategy to leverage multiple pools of capital, including skips and chips in the US and Europe to balance our long-term capacity aspirations with near-term realities. Before I turn it over to Dave, I'm going to close by saying, we take our commitments to all our stakeholders extremely seriously and ultimately, we strive to create value for each of them. For our customers, it is rebuilding our execution engine to provide a predictable cadence of best-in-class products to support their ambitions. For our employees is to provide them with the opportunity to develop and bring to market world-changing technologies. It is what inspires each of us inside of the company. For our external owners is to make thoughtful, deliberate decisions around capital allocation, which drives the highest return on investment we make with your capital.

Our ambitions are equal by our passion, and our efforts across manufacturing, design, products and foundry are well on their way to driving our transformation and creating the flywheel, which is IBM 2.0.

David Zinsner: Thank you, Pat, and good afternoon, everyone. We saw solid business execution in the fourth quarter despite persistent macroeconomic headwinds impacting the semiconductor industry. As Pat indicated, we expect challenging macro conditions to continue through at least the first half of the year. As outlined last quarter, we'll continue to prioritize investments critical to our transformation, prudently and aggressively managed expenses near-term and drive fundamental improvements in our cost structure longer term. We're executing well towards our $3 billion target in 2023 and $8 billion to $10 billion exiting 2025. Fourth quarter revenue was $14 billion, landing at the low end of our range and down 8% sequentially.

Revenue from DCAI and NEX were in line with expectations, while CCG was impacted by softening demand for PCs. Gross margin for the quarter was 44%, slightly better than we had expected for the low end of our revenue range. Q4 gross margins were impacted 220 basis points from factory underload charges, offsetting a sequential 170 basis point benefit from an insurance settlement. EPS for the quarter was $0.10. $0.10 below our guide on lower revenue and increased inventory reserves. Operating cash flow for the quarter was $7.7 billion. Net CapEx was $4.6 billion, resulting in an adjusted free cash flow of $3.1 billion and we paid dividends of $1.5 billion. We finished FY 2022 with revenue of $63.1 billion, gross margin of 47.3% and EPS of $1.84.

We generated $15.4 billion of cash from operations and an adjusted free cash flow of approximately negative $4 billion at the low end of the range we provided last quarter, despite approximately $3 billion of capital incentives that shifted from Q4 into 2023. When we spoke at Investor Day last February, we forecasted revenue of $76 billion and adjusted free cash flow of negative $1 billion to $2 billion for FY 2022. As macroeconomic conditions deteriorated at a rapid pace in second half of 2022, we committed to optimizing the areas of the business within our control. Through reductions in spending and significant working capital improvements, we offset a $13 billion reduction to revenue expectations to come within $2 billion of our initial adjusted free cash flow guide, while still making the needed capital investments in support of our IDM 2.0 strategy, and to position ourselves for long-term growth in a market expected to reach $1 trillion by 2030.

Pixabay/Public Domain

Our balance sheet remains strong with cash and investment balances of more than $28 billion, modest leverage and a strong investment-grade profile. Moving to fourth quarter business unit results. CCG revenue was $6.6 billion, a decline of 36% year-over-year as PC TAM deteriorated faster than expected due to macroeconomic headwinds. Customer inventory remains elevated beyond our previous expectations and will continue to burn into the first half of 2023. CCG realized record CPU ASPs, up 11% year-over-year as we continue to see relative strength in our premium segments driven by leadership performance and attractive features of our Evo and vPro platforms. Q4 operating profit was $0.7 billion, down year-over-year on lower revenue and increased Intel 7 product mix.

DCAI revenue was $4.3 billion in Q4, up 2% sequentially, with higher ASPs offsetting demand softness and down 33% year-over-year, driven by TAM contraction and competitive pressure. DCAI operating profit for the fourth quarter was $371 million. While still under satisfactory, profit was up more than $350 million sequentially on reduced factory costs. Operating profit was down substantially year-over-year, impacted by lower revenue, increased advanced node start-up costs and higher product costs. Within DCAI, PSG achieved record Q4 revenue, up 42% year-over-year, along with record full year revenue, up 29% year-over-year, through increased ASPs, improved external supply and strength in the infrastructure segment. PSG enters 2023 with still significant unfulfilled backlog.

NEX quarterly revenue was $2.1 billion, down 1% year-over-year, as declining global GDP impacted the Edge business, offsetting growth in Xeon network CPUs and the ramp of our Mounts Evans infrastructure processing unit. Despite second half macro headwinds, NEX set another full year record revenue at $8.9 billion, up 11% year-over-year and marking consecutive years of double-digit revenue growth. Operating profit was $58 million in the fourth quarter, down on mix shift to lower-margin segments and higher factory start-up costs. AXG achieved record quarterly revenue of $247 million, up 34% sequentially and up 1 point year-over-year, supported by the launch of Sapphire Rapids HBM. Operating loss was $441 million, down $63 million sequentially, with inventory valuations negatively impacted by softer demand, especially for crypto processors.

Mobileye delivered another record revenue quarter of $565 million, up 26% sequentially and growth of more than $200 million and 59% year-over-year. Full year revenue of $1.9 billion was also a record for Mobileye, growing 35% year-over-year. Fourth quarter operating income of $210 million represents 71% growth year-over-year. IFS achieved record quarterly revenue of $319 million, up 87% sequentially and 30% year-over-year on increased automotive shipments. Operating loss was $31 million, a $72 million improvement sequentially on higher revenue. We continue to reshape the company to drive to world-class product costs and operational efficiency. We remain committed to the $3 billion of 2023 cost savings outlined on our Q3 earnings call, while mindfully protecting the investments needed to accelerate our transformation and ensure we are well positioned for long-term market growth.

Before turning to Q1 guidance, let me take a moment to discuss an accounting change that will impact our results beginning in the first quarter. Effective January 2023, we increased the estimated useful life of certain production machinery and equipment from five years to eight years. This change better reflects the demonstrated economic value of our machinery and equipment over time and is more aligned with the business model changes inherent to our IDM 2.0 strategy. The growth of the IFS deal pipeline will extend the life of manufacturing nodes beyond what was practical within IDM 1.0. Disaggregated CPU architecture allows performance and cost optimization for each chiplet better leveraging older nodes. And we are optimizing our core business around more sustainable capacity quarters to improve equipment utilization and maximize ROIC.

The change will be applied prospectively beginning Q1 2023. When compared to the estimated useful life in place as of the end of 2022, we expect total depreciation expense in 2023 to reduce by roughly $4.2 billion. An approximate $2.6 billion increase to gross profit, a $400 million decrease in R&D expense and a $1.2 billion decrease in ending inventory values. This change will not be counted towards the $3 billion short-term or $8 billion to $10 billion long-term structural cost improvements we committed last quarter, and is intended to provide the most accurate reflection of company financial results to our owners. Now turning to guidance. For Q1, we expect first quarter revenue of $10.5 billion to $11.5 billion. In addition to continued macro headwinds, we expect customers will burn inventory at a meaningfully faster pace than the prior few quarters in response to macro TAM softness impacting CCG, DCAI and the x lines of business.

We see potential for market conditions to improve faster than typical seasonality as third-party data shows macro headwinds easing in the second half of the year. While we're progressing toward a $3 billion spending reduction with significant austerity across the company, given the fixed cost nature of our business, we expect the sequential revenue decline will result in negative operating margin in the first quarter. We're forecasting gross margin of 39%, a tax rate of 30% and EPS of negative $0.15 at the midpoint of revenue guidance, inclusive of $350 million to $500 million of operating margin benefit from the useful life accounting change, split approximately 75% to cost of sales and 25% to OpEx. Factory underload charges are projected to impact Q1 gross margin by 400 basis points.

We continue to evaluate all investments and will remain laser-focused on optimizing for ROI, adjusting for market conditions across operating expenses and capital assets. While we're not providing guidance beyond Q1, I'll touch on a few elements of our outlook. At Investor Day, we noted that during the investment phase of IDM 2.0 from 2022 through 2024, our model was to operate at approximately 35% net capital intensity. For FY 2023, despite the lower revenue level, we expect to be at or below the 35% model. Embedded in our assumptions are capital offsets of around 20% to 30% of growth CapEx including our innovative SCIP partnership with Brookfield. We expect FY 2023 operating expenses of under $20 billion, a roughly 10% year-over-year decline, consistent with committed cost-cutting measures totaling $2 billion, adjusting for the depreciation change.

Adjusted free cash flow will be below our Investor Day guide of approximately neutral in the first half of 2023 and return back towards guardrails in second half 2023. In closing, we remain committed to the strategy and long-term financial model we laid out at Investor Day last year. The opportunity for strong revenue growth across our business unit portfolio and free cash flow at 20% of revenue remains. While we're not satisfied with near-term results, this market downturn represents an opportunity to accelerate the transformation necessary to achieve our long-term goals. I look forward to providing updates on our transformation journey as the year progresses. With that, let me turn the call back over to John.

John Pitzer: Thank you, Dave. We will now move into the Q&A portion of our call. As a reminder, we ask each caller to ask one question and a brief follow-up question where applicable. With that, Jonathan, can we please take the first caller?

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Intel discloses $7 billion operating loss for chip-making unit

By Stephen Nellis and Max A. Cherney

(Reuters) - Intel on Tuesday disclosed deepening operating losses for its foundry business, a blow to the chipmaker as it tries to regain a technology lead it lost in recent years to Taiwan Semiconductor Manufacturing.

Intel said the manufacturing unit had $7 billion in operating losses for 2023, a steeper loss than the $5.2 billion in operating losses the year before. The unit had revenue of $18.9 billion for 2023, down 31% from $27.49 billion the year before.

Intel shares were down 4.3% after the documents were filed with the U.S. Securities and Exchange Commission (SEC).

During a presentation for investors, Chief Executive Pat Gelsinger said 2024 would be the year of worst operating losses for the company's chipmaking business and that it expects to break even on an operating basis by about 2027.

Gelsinger said the foundry business was weighed down by bad decisions, including one year ago against using extreme ultraviolet (EUV) machines from Dutch firm ASML. While those machines can cost more than $150 million, they are more cost-effective than earlier chip making tools.

Partially as a result of the missteps, Intel has outsourced about 30% of the total number of wafers to external contract manufacturers such as TSMC, Gelsinger said. It aims to bring that number down to roughly 20%.

Intel has now switched over to using EUV tools, which will cover more and more production needs as older machines are phased out.

"In the post EUV era, we see that we're very competitive now on price, performance (and) back to leadership," Gelsinger said. "And in the pre-EUV era we carried a lot of costs and (were) uncompetitive."

Intel plans to spend $100 billion on building or expanding chip factories in four U.S. states. Its business turnaround plan depends on persuading outside companies to use its manufacturing services.

As part of that plan, Intel told investors it would start reporting the results of its manufacturing operations as a standalone unit. The company has been investing heavily to catch up to its primary chipmaking rivals, TSMC and Samsung Electronics Co Ltd .

(This story has been corrected to change the 2022 revenue figure for Intel Foundry to $27.49 billion in paragraph 2)

(Reporting by Priyanka.G in Bengaluru and Stephen Nellis and Max Cherney in San Francisco; Editing by Krishna Chandra Eluri and David Gregorio)

Intel discloses $7 billion operating loss for chip-making unit

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Reporting by Priyanka.G in Bengaluru and Stephen Nellis and Max Cherney in San Francisco; Editing by Krishna Chandra Eluri and David Gregorio

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TSMC wins $6.6 bln US subsidy for Arizona chip production

The U.S. Commerce Department said on Monday it would award Taiwan Semiconductor Manufacturing Co's (TSMC) U.S. unit a $6.6 billion subsidy for advanced semiconductor production in Phoenix, Arizona and up to $5 billion in low-cost government loans.

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For the first time Rosatom Fuel Division supplied fresh nuclear fuel to the world’s only floating nuclear cogeneration plant in the Arctic

The fuel was supplied to the northernmost town of Russia along the Northern Sea Route.

The first in the history of the power plant refueling, that is, the replacement of spent nuclear fuel with fresh one, is planned to begin before 2024. The manufacturer of nuclear fuel for all Russian nuclear icebreakers, as well as the Akademik Lomonosov FNPP, is Machinery Manufacturing Plant, Joint-Stock Company (MSZ JSC), a company of Rosatom Fuel Company TVEL that is based in Elektrostal, Moscow Region.

The FNPP includes two KLT-40S reactors of the icebreaking type. Unlike convenient ground-based large reactors (that require partial replacement of fuel rods once every 12-18 months), in the case of these reactors, the refueling takes place once every few years and includes unloading of the entire reactor core and loading of fresh fuel into the reactor.

The cores of KLT-40 reactors of the Akademik Lomonosov floating power unit have a number of advantages compared to the reference ones: a cassette core was used for the first time in the history of the unit, which made it possible to increase the fuel energy resource to 3-3.5 years between refuelings, and also reduce the fuel component of the electricity cost by one and a half times. The FNPP operating experience formed the basis for the designs of reactors for nuclear icebreakers of the newest series 22220. Three such icebreakers have been launched by now.

For the first time the power units of the Akademik Lomonosov floating nuclear power plant were connected to the grid in December 2019, and put into commercial operation in May 2020. The supply of nuclear fuel from Elektrostal to Pevek and its loading into the second reactor is planned for 2024. The total power of the Akademik Lomonosov FNPP, supplied to the coastal grid of Pevek without thermal energy consumption on shore, is about 76 MW, being about 44 MW in the maximum thermal power supply mode. The FNPP generated 194 million kWh according to the results of 2023. The population of Pevek is just a little more than 4 thousand, while the FNPP has a potential for supplying electricity to a city with a population of up to 100 thousand people. After the FNPP commissioning two goals were achieved. These include first of all the replacement of the retiring capacities of the Bilibino NPP, which has been operating since 1974, as well as the Chaunskaya TPP, which has already been operating for more than 70 years. Secondly, energy is supplied to the main mining companies in western Chukotka in the Chaun-Bilibino energy hub a large ore and metal cluster, including gold mining companies and projects related to the development of the Baimsk ore zone. In September 2023, a 110 kilovolt power transmission line with a length of 490 kilometers was put into operation, connecting the towns of Pevek and Bilibino. The line increased the reliability of energy supply from the FNPP to both Bilibino consumers and mining companies, the largest of which is the Baimsky GOK. The comprehensive development of the Russian Arctic is a national strategic priority. To increase the NSR traffic is of paramount importance for accomplishment of the tasks set in the field of cargo shipping. This logistics corridor is being developed due regular freight voyages, construction of new nuclear-powered icebreakers and modernization of the relevant infrastructure. Rosatom companies are actively involved in this work. Rosatom Fuel Company TVEL (Rosatom Fuel Division) includes companies fabricating nuclear fuel, converting and enriching uranium, manufacturing gas centrifuges, conducting researches and producing designs. As the only nuclear fuel supplier to Russian NPPs, TVEL supplies fuel for a total of 75 power reactors in 15 countries, for research reactors in nine countries, as well as for propulsion reactors of the Russian nuclear fleet. Every sixth power reactor in the world runs on TVEL fuel. Rosatom Fuel Division is the world’s largest producer of enriched uranium and the leader on the global stable isotope market. The Fuel Division is actively developing new businesses in chemistry, metallurgy, energy storage technologies, 3D printing, digital products, and decommissioning of nuclear facilities. TVEL also includes Rosatom integrators for additive technologies and electricity storage systems. Rosenergoatom, Joint-Stock Company is part of Rosatom Electric Power Division and one of the largest companies in the industry acting as an operator of nuclear power plants. It includes, as its branches, 11 operating NPPs, including the FNPP, the Scientific and Technical Center for Emergency Operations at NPPs, Design and Engineering as well as Technological companies. In total, 37 power units with a total installed capacity of over 29.5 GW are in operation at 11 nuclear power plants in Russia. Machinery Manufacturing Plant, Joint-Stock Company (MSZ JSC, Elektrostal) is one of the world’s largest manufacturers of fuel for nuclear power plants. The company produces fuel assemblies for VVER-440, VVER-1000, RBMK-1000, BN-600,800, VK-50, EGP-6; powders and fuel pellets intended for supply to foreign customers. It also produces nuclear fuel for research reactors. The plant belongs to the TVEL Fuel Company of Rosatom.

Rosatom obtained a license for the first land-based SMR in Russia

On April 21, Rosenergoatom obtained a license issued by Rostekhnadzor to construct the Yakutsk land-based SMR in the Ust-Yansky District of the Republic of Sakha (Yakutia).

ROSATOM and FEDC agree to cooperate in the construction of Russia's first onshore SNPP

ROSATOM and FEDC have signed a cooperation agreement to build Russia's first onshore SNPP in Yakutia.

Rosatom develops nuclear fuel for modernized floating power units

Rosatom has completed the development of nuclear fuel for the RITM-200S small modular reactor designed for the upgraded floating power units.

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40 facts about elektrostal.

Written by Lanette Mayes

Modified & Updated: 02 Mar 2024

Reviewed by Jessica Corbett

Elektrostal is a vibrant city located in the Moscow Oblast region of Russia. With a rich history, stunning architecture, and a thriving community, Elektrostal is a city that has much to offer. Whether you are a history buff, nature enthusiast, or simply curious about different cultures, Elektrostal is sure to captivate you.

This article will provide you with 40 fascinating facts about Elektrostal, giving you a better understanding of why this city is worth exploring. From its origins as an industrial hub to its modern-day charm, we will delve into the various aspects that make Elektrostal a unique and must-visit destination.

So, join us as we uncover the hidden treasures of Elektrostal and discover what makes this city a true gem in the heart of Russia.

Key Takeaways:

• Elektrostal, known as the “Motor City of Russia,” is a vibrant and growing city with a rich industrial history, offering diverse cultural experiences and a strong commitment to environmental sustainability.
• With its convenient location near Moscow, Elektrostal provides a picturesque landscape, vibrant nightlife, and a range of recreational activities, making it an ideal destination for residents and visitors alike.

Known as the “Motor City of Russia.”

Elektrostal, a city located in the Moscow Oblast region of Russia, earned the nickname “Motor City” due to its significant involvement in the automotive industry.

Home to the Elektrostal Metallurgical Plant.

Elektrostal is renowned for its metallurgical plant, which has been producing high-quality steel and alloys since its establishment in 1916.

Boasts a rich industrial heritage.

Elektrostal has a long history of industrial development, contributing to the growth and progress of the region.

Founded in 1916.

The city of Elektrostal was founded in 1916 as a result of the construction of the Elektrostal Metallurgical Plant.

Located approximately 50 kilometers east of Moscow.

Elektrostal is situated in close proximity to the Russian capital, making it easily accessible for both residents and visitors.

Known for its vibrant cultural scene.

Elektrostal is home to several cultural institutions, including museums, theaters, and art galleries that showcase the city’s rich artistic heritage.

A popular destination for nature lovers.

Surrounded by picturesque landscapes and forests, Elektrostal offers ample opportunities for outdoor activities such as hiking, camping, and birdwatching.

Hosts the annual Elektrostal City Day celebrations.

Every year, Elektrostal organizes festive events and activities to celebrate its founding, bringing together residents and visitors in a spirit of unity and joy.

Has a population of approximately 160,000 people.

Elektrostal is home to a diverse and vibrant community of around 160,000 residents, contributing to its dynamic atmosphere.

Boasts excellent education facilities.

The city is known for its well-established educational institutions, providing quality education to students of all ages.

A center for scientific research and innovation.

Elektrostal serves as an important hub for scientific research, particularly in the fields of metallurgy, materials science, and engineering.

Surrounded by picturesque lakes.

The city is blessed with numerous beautiful lakes, offering scenic views and recreational opportunities for locals and visitors alike.

Well-connected transportation system.

Elektrostal benefits from an efficient transportation network, including highways, railways, and public transportation options, ensuring convenient travel within and beyond the city.

Famous for its traditional Russian cuisine.

Food enthusiasts can indulge in authentic Russian dishes at numerous restaurants and cafes scattered throughout Elektrostal.

Home to notable architectural landmarks.

Elektrostal boasts impressive architecture, including the Church of the Transfiguration of the Lord and the Elektrostal Palace of Culture.

Offers a wide range of recreational facilities.

Residents and visitors can enjoy various recreational activities, such as sports complexes, swimming pools, and fitness centers, enhancing the overall quality of life.

Provides a high standard of healthcare.

Elektrostal is equipped with modern medical facilities, ensuring residents have access to quality healthcare services.

Home to the Elektrostal History Museum.

The Elektrostal History Museum showcases the city’s fascinating past through exhibitions and displays.

A hub for sports enthusiasts.

Elektrostal is passionate about sports, with numerous stadiums, arenas, and sports clubs offering opportunities for athletes and spectators.

Celebrates diverse cultural festivals.

Throughout the year, Elektrostal hosts a variety of cultural festivals, celebrating different ethnicities, traditions, and art forms.

Electric power played a significant role in its early development.

Elektrostal owes its name and initial growth to the establishment of electric power stations and the utilization of electricity in the industrial sector.

Boasts a thriving economy.

The city’s strong industrial base, coupled with its strategic location near Moscow, has contributed to Elektrostal’s prosperous economic status.

Houses the Elektrostal Drama Theater.

The Elektrostal Drama Theater is a cultural centerpiece, attracting theater enthusiasts from far and wide.

Popular destination for winter sports.

Elektrostal’s proximity to ski resorts and winter sport facilities makes it a favorite destination for skiing, snowboarding, and other winter activities.

Promotes environmental sustainability.

Elektrostal prioritizes environmental protection and sustainability, implementing initiatives to reduce pollution and preserve natural resources.

Home to renowned educational institutions.

Elektrostal is known for its prestigious schools and universities, offering a wide range of academic programs to students.

Committed to cultural preservation.

The city values its cultural heritage and takes active steps to preserve and promote traditional customs, crafts, and arts.

Hosts an annual International Film Festival.

The Elektrostal International Film Festival attracts filmmakers and cinema enthusiasts from around the world, showcasing a diverse range of films.

Encourages entrepreneurship and innovation.

Elektrostal supports aspiring entrepreneurs and fosters a culture of innovation, providing opportunities for startups and business development.

Offers a range of housing options.

Elektrostal provides diverse housing options, including apartments, houses, and residential complexes, catering to different lifestyles and budgets.

Home to notable sports teams.

Elektrostal is proud of its sports legacy, with several successful sports teams competing at regional and national levels.

Boasts a vibrant nightlife scene.

Residents and visitors can enjoy a lively nightlife in Elektrostal, with numerous bars, clubs, and entertainment venues.

Promotes cultural exchange and international relations.

Elektrostal actively engages in international partnerships, cultural exchanges, and diplomatic collaborations to foster global connections.

Surrounded by beautiful nature reserves.

Nearby nature reserves, such as the Barybino Forest and Luchinskoye Lake, offer opportunities for nature enthusiasts to explore and appreciate the region’s biodiversity.

Commemorates historical events.

The city pays tribute to significant historical events through memorials, monuments, and exhibitions, ensuring the preservation of collective memory.

Promotes sports and youth development.

Elektrostal invests in sports infrastructure and programs to encourage youth participation, health, and physical fitness.

Hosts annual cultural and artistic festivals.

Throughout the year, Elektrostal celebrates its cultural diversity through festivals dedicated to music, dance, art, and theater.

Provides a picturesque landscape for photography enthusiasts.

The city’s scenic beauty, architectural landmarks, and natural surroundings make it a paradise for photographers.

Connects to Moscow via a direct train line.

The convenient train connection between Elektrostal and Moscow makes commuting between the two cities effortless.

A city with a bright future.

Elektrostal continues to grow and develop, aiming to become a model city in terms of infrastructure, sustainability, and quality of life for its residents.

In conclusion, Elektrostal is a fascinating city with a rich history and a vibrant present. From its origins as a center of steel production to its modern-day status as a hub for education and industry, Elektrostal has plenty to offer both residents and visitors. With its beautiful parks, cultural attractions, and proximity to Moscow, there is no shortage of things to see and do in this dynamic city. Whether you’re interested in exploring its historical landmarks, enjoying outdoor activities, or immersing yourself in the local culture, Elektrostal has something for everyone. So, next time you find yourself in the Moscow region, don’t miss the opportunity to discover the hidden gems of Elektrostal.

Q: What is the population of Elektrostal?

A: As of the latest data, the population of Elektrostal is approximately XXXX.

Q: How far is Elektrostal from Moscow?

A: Elektrostal is located approximately XX kilometers away from Moscow.

Q: Are there any famous landmarks in Elektrostal?

A: Yes, Elektrostal is home to several notable landmarks, including XXXX and XXXX.

Q: What industries are prominent in Elektrostal?

A: Elektrostal is known for its steel production industry and is also a center for engineering and manufacturing.

Q: Are there any universities or educational institutions in Elektrostal?

A: Yes, Elektrostal is home to XXXX University and several other educational institutions.

Q: What are some popular outdoor activities in Elektrostal?

A: Elektrostal offers several outdoor activities, such as hiking, cycling, and picnicking in its beautiful parks.

Q: Is Elektrostal well-connected in terms of transportation?

A: Yes, Elektrostal has good transportation links, including trains and buses, making it easily accessible from nearby cities.

Q: Are there any annual events or festivals in Elektrostal?

A: Yes, Elektrostal hosts various events and festivals throughout the year, including XXXX and XXXX.

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