Shares of Santa Clara, California-based semiconductor manufacturer Intel Corp. (INTC) have outperformed the broader market in 2018, while a surge of volatility weighs down heavily on the same high-flying tech stocks that carried the nine-year bull market to its end this January. (See also: Intel a ‘Top Pick’ Despite Poor Sentiment: Citi.)

Linley Gwennap, the head of research firm Linley Group, suggests that despite Intel's solid run in 2018, the chipmaker's time at the helm of its industry is running out. In a report Monday in the chip-industry newsletter Microprocessor Report, the industry researcher suggested that Intel is falling behind its competitors including Taiwan Semiconductor (TSM), the world's largest contract chipmaker; South Korea's Samsung Electronics; and privately held GlobalFoundries. As Intel continues to delay its attempts to manufacture its 10-nanometer process (making chips with dimensions as small as 10 billionths of an inch), it risks seeing its long-held lead in making the best integrated circuits in the world "disappear," wrote Gwennap.  

Rivals Closing In

The three aforementioned suppliers also produce chips for Intel rivals such as Qualcomm Inc. (QCOM), as well as large customers including Apple Inc. (AAPL), noted the analyst, indicating that apart from the race to achieve the best technology, the rising dominance of these semi companies threatens to eat away at a significant portion of Intel's chip sales.

After undergoing a thorough examination of each companies' offerings, Linley concludes that while there remain differences of nomenclature between various technologies, Intel's rivals really are closing in on the market leader. He expects "7-nanometer" technology from TSM, Samsung and Global to rival Intel's 10-nanometer process. As a result, "the three leading foundries, which serve all of Intel's major competitors, will be on the same level as the x86 giant," wrote Gwennap. The researcher suggests that the three competitors may beat out Intel before the chip behemoth is able to move on to its next technology, set for around 2021.

Trading up 2.4% on Tuesday afternoon at $53.62, INTC reflects a 16% gain year-to-date (YTD) and a 51% return over the most recent 12 months, sharply outperforming the S&P 500's 1% increase and 15% growth over the same respective periods. (See also: Buy Intel, Ditch Micron: UBS.)