Intel might replace the 18A node with the 14A node to attract Apple and Nvidia

Intel considers shifting focus to 14A node to lure Apple and Nvidia.

: Stringent market conditions are prompting Intel, under the new leadership of CEO Lip-Bu Tan, to consider discarding the 18A manufacturing process in favor of a more advanced 14A node aimed at courting major clients like Apple and Nvidia. Former CEO Pat Gelsinger had heavily invested in the 18A node believing it to be a key to competing with TSMC, whereas Intel now faces a potential billion-dollar write-off from this pivot. As part of these strategic shifts, Intel also reported a significant $18.8 billion loss in 2024 and remains committed to fulfilling existing agreements with Amazon and Microsoft using the 18A node. The company's future seemingly hinges on persuading industry heavyweights to transition to Intel's new processes, thereby regaining lead in the semiconductor industry.

Intel, a titan in the semiconductor industry, is exploring a significant shift in its manufacturing strategy under the guidance of its newly appointed CEO, Lip-Bu Tan. The company is contemplating replacing its heavily promoted 18A manufacturing process with a more advanced 14A node, an initiative aimed at winning the business of major tech giants like Apple and Nvidia, who are currently aligned with TSMC. The substantial write-off Intel might endure if the 18A process, which was a flagship project of former CEO Pat Gelsinger, is shelved, could have substantial financial implications.

Pat Gelsinger, Intel’s previous CEO, was instrumental in championing the 18A node, positioning it as a crucial technology to level Intel with TSMC. Significant financial resources were dedicated to its development, with the expectation that it would revolutionize Intel’s capacity to produce competitive chips domestically. Lip-Bu Tan, after taking stewardship in early 2025, has shown dissatisfaction with the progress and delays in the 18A node and its variant 18A-P, expressing concerns that these shortcomings diminish its attractiveness to potential customers.

Intel has publicly dismissed speculations surrounding these internal discussions as conjectures and has reiterated that it remains the primary client for its 18A node. The company assures stakeholders that its Panther Lake processors, the first to utilize the 18A process, are still slated for release later in 2025, signifying no immediate halt to current manufacturing commitments. Furthermore, despite acknowledging a staggering financial loss of $18.8 billion in 2024, Intel is outlining strategic shifts to realign with the market demands and customer expectations.

Strategically, Intel underscores its ongoing collaboration with existing clients, such as Amazon and Microsoft, confirming that it will deliver on these agreements using the 18A node. Neither Amazon nor Microsoft seems inclined to defer till the availability of the 14A node, ensuring that Intel’s commitment to fulfilling customer orders remains intact. This internal policy forms part of Intel's broader efforts aimed at restoring financial stability and retaining trust amidst industry transformations.

Rumors about Intel possibly spinning off its foundry business persist, as the company might instead redirect efforts towards bolstering its core x86 chip design unit. CEO Lip-Bu Tan has neither entered into, nor openly refuted, such prospects, suggesting that any future decisions will heavily rely on whether Intel can successfully persuade substantial defectors like Apple and Nvidia to abandon TSMC through the appeal of its emerging 14A technology.

Sources: TechSpot, Reuters

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