SANTA CLARA, California: Intel plans to raise US$15 billion through a share sale to help finance the expansion of its contract chip manufacturing business, capitalizing on a sharp rally in its stock driven by growing confidence in the company's turnaround efforts.

The chipmaker announced on August 10 that it intends to use the proceeds to support investments in new manufacturing facilities and advanced chip packaging as it seeks to compete more aggressively with Taiwan Semiconductor Manufacturing Co. (TSMC) in the contract chipmaking market.

Intel's shares fell more than 4 percent in early trading. Even so, the stock has nearly tripled this year, outperforming rivals AMD and Nvidia as well as the Philadelphia Semiconductor Index, which has risen nearly 75 percent.

Several analysts had said Intel's strong share-price performance increased the likelihood that the company would raise equity to fund its expansion plans.

"As a capital-intensive business that went a long way to wrecking its own balance sheet and prospects by focusing on financial engineering rather than physical engineering, courtesy of $82 billion of share buybacks in the 2010s, it makes perfect sense for Intel to raise money, especially after a five-fold increase in the stock price since last August," said Russ Mould, investment director at AJ Bell.

The growing use of AI agents has increased demand for central processing units beyond Intel's manufacturing capacity, prompting the company to raise its capital expenditure forecast for this year in July to $20 billion from $18 billion.

Intel also committed to high-volume production using its 14A manufacturing process in 2028, after previously warning the technology could be shelved without securing a major external customer.

The company's foundry business has already secured Tesla as a 14A customer, while optimism about another major client increased after U.S. President Donald Trump said Apple would manufacture processors with Intel, although neither company has confirmed the arrangement.

Last month, Intel announced a five-billion-euro ($5.77 billion) investment to upgrade and expand its manufacturing operations in Ireland, representing more than 25 percent of its planned capital spending for 2026.

As part of the offering, Intel plans to give underwriters a 30-day option to purchase up to $2.25 billion of additional shares at the offering price, minus discounts.

JPMorgan Securities, Goldman Sachs, Morgan Stanley and Citigroup Global Markets are acting as joint book-running managers.