While Intel is almost certain to do other foundry deals like the one announced today, we don't see the chipmaker actually pursuing a real foundry model. Rather, Achronix and deals like it will enable Intel to develop new markets with less downside risk, and will ultimately grow the company's IDM business through acquisitions.

Canesta makes chips that, when coupled with a digital camera, give all manner of devices a sense of depth perception for the world around them, letting them "see" in three dimensions.

The US$2.5 billion chip factory is producing chips on 12-inch silicon wafers, mainly chipsets to be used in desktop computers, laptops and servers. The factory is already fully operational.

Don't underestimate Intel's ability to retool and come back strong. In two years, earnings could top US$3 per share.