Either, the man engages in cognitive activity without Chinese-speaking intentionality. When he operates the internalized Chinese Room he actively thinks, even though he doesn't understand what the squiggles & squoggles mean. In which case, we can't justifiably deny the presence of some kind of cognition in the internalized Chinese Room.
Or, the man engages in cognitive activity with Chinese-speaking intentionality (e.g. he may know that "Squiggle-squoggle" is generally followed by "squoggle-squoggle"). In which case, that intentionality may carry over to the internalized Chinese Room as well.
In either case, the internalization reply doesn't conclusively refute the idea that machines can think.
Philip Cam, 1990.