Intel admits it doesn't have any 'significant' commitments from customers to make advanced chips in its fabs
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For almost as long as we can remember (okay, about three years), the 18A node has been all-important for Intel. Former CEO Pat Gelsinger said he'd bet the whole company on 18A. Indeed, the first 18A chips are due later this year in the form of intel's next CPU for laptops, Panther Lake. But according to Intel itself, 18A has yet to win any "significant" business from customers.
The comment comes from David Zinsner, Intel's CFO, during a conference in Boston yesterday. "We get test chips, and then some customers fall out of the test chips... So committed volume is not significant right now, for sure," Zinsner is reported by Reuters to have said.
This is not good news. The likes of Nvidia and Broadcom are widely reported to have sent test chips to Intel to assess the 18A node. Whatever the identity of the companies that have tested 18A, what Zinsner is confirming is that none of those test chips have convinced a major customer to place a big order with Intel.
In other words, potential customers have given 18A a try with test chips and haven't yet been convinced to sign a deal, at least not for what Intel itself deems a "significant" volume of chips. And producing chips for customers, as opposed to only making its own products like Core CPUs, is central to Intel's plans for recovery from struggles in recent years.
How all this fits in with a purported $15 billion deal between Intel and Microsoft to produce chips isn't clear. That tie up was announced way back in February 2024. As far as we know, that hasn't translated into chips being manufactured and CFO Zinsner's comments seem to indicate that Microsoft is not currently producing chips at volume with Intel.
What's odd in the context of the announced Microsoft deal is the implication from Zinsner that there aren't even any significant commitments to produce chips.
As is seemingly always the case with Intel and it's 18A node, we'll just have to wait and see. Panther Lake is supposedly coming later this year, so we'll just have to hope it arrives on time and see iof it's any good.
We'll likewise have to wait and see if Intel can convince anyone else to sign up to the 18A node any time soon. But the clock is surely ticking. Much of the industry is expected to sign up to TSMC's competing node. AMD, for instance, says it's next-gen Venice server CPU based on Zen 6 CPU cores will be built on TSMC's N2 node.
While such chips won't be released for some time, deals to make them are being signed now, and if Intel doesn't begin winning business soon, it could be too late for 18A.
Of course, Intel also has a 14A node in development. But like ex-CEO Gelsinger said, Intel has bet the company on 18A. So, it surely needs to win at least some significant business.
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