The new CEO of San Francisco (Reuters) (INTC) is exploring major changes in the manufacturing business of his contract to win the main customers, two people familiar with the issue, Reuters said, potentially expensive to move from its predecessor’s plans.
If this were implemented, the new strategy of what Intel calls its “foundry” business is no longer able to read the external customers of certain trace element production technology that the company has long since created, said people.
Since March As part of the wheel of the company, the CEO Lip-Bu Tan quickly moved to reduce costs and find a new path to revive a heavy US chip manufacturer. By June, he began to express that the production process, which the pre -Director General, is also a great bet, known as 18A, lost its attractiveness to new customers, said sources who spoke to anonymity condition.
To eliminate the external sales of 18A and its version of 18A-P, the production processes, which cost Intel billions of dollars, will have to relax, said one of the people who met the issue. Industrial analysts contacted by Reuters said such an accusation could be hundreds of millions, if not billions of dollars.
Intel refused to comment on such “hypothetical scenarios or market speculation.” He said that the main customer of 18A has long been Intel himself, and aims to increase the production of his Panther Lake laptop chips later in 2025.
To persuade external customers to use Intel factories remain the key to its future. As its 18A production process is delayed, the technology of competing TSMC N2 was preparing for production.
Preliminary Tan’s response to this challenge: focus more on the 14A-new generation of trace elements, when Intel hopes to have advantages compared to Taiwan TSMC, two sources said. This step is part of the game for big customers such as Apple and NVIDIA, who currently pay TSMC for their chips.
File Photo: Intel CEO, Lip -u Tan, speaks in California
Tan has commissioned the company to prepare a discussion with the Intel Board options when it meets this month, including whether to suspend 18A marketing for new customers, said one of two sources. The Board may not reach the decision 18A until the subsequent autumn meeting, taking into account the complexity of the case and the huge money that risks, the person said.
Intel refused to comment on what he calls rumors. According to its report, “Lip-BU and the executive team are committed to strengthening our plan, strengthening confidence in their customers and improving our financial position for the future. We have identified clear areas of attention and will take the actions needed to change the business. “
The last year was the first Intel’s unprofitable year since 1986. It declared a net loss assigned to the company $ 18.8 billion in 2024.
Intel CEO’s considerations show a huge risk – and costs – to transfer a high US chip manufacturer to a solid foundation. Like Gelsinger, Tan inherited a company that lost its production advantage and lags behind the most important waves of two decades of technology: mobile computer and artificial intelligence.
Later this year, the company directs a large -scale production with 18A with its inner chips, which are widely expected to enter the external customer orders. Meanwhile, if you want to win the main contracts, there is no doubt that Intel’s time to win the main contracts, and Intel could choose to follow the existing 18A plans, said one of the sources.
The company said Intel adapts 14A to the main needs of customers to make it successful.
Amazon and Microsoft 18a
Tan’s review of whether to focus customers on 14A includes the production part of the Intel contract or foundation that produces chips for external customers.
Despite the decision of the board, Intel will make tokens in 18A in cases where its plans are already moving, people who are familiar with the matter said. This includes the use of 18A for Intel’s inner tokens that it has already developed for the production process, people said.
Intel will also produce a relatively small amount of chips it guarantees on Amazon.com and Microsoft over 18A, with terms that make it unrealistic to wait for 14A development.
Amazon and Microsoft immediately did not comment on the issue. Intel said it would be due to its customer’s obligations.
The overall Tan Intel strategy remains new. Until now, he has updated his leadership team, attracting new engineering talent and trying to shrink what he thought was a bloated and slowly moving middle leadership.
Using 18A sales foundry customers would represent another of its biggest steps.
The 18A production process has a new energy supply method for lads and new type transistors. At the same time, these improvements were designed to allow Intel to reconcile or exceed TSMC capabilities, previously Intel executives said.
However, according to some industrial analysts, the 18A process is approximately corresponding to the TSMC so -called N3 production technology. At the end of the 19th century it was produced in large -scale.
If Intel followed Tan, the company would focus on its foundry workers, design partners and new customers in 14A, where it expects to compete with TSMC.
Tan has established large contacts and customer contacts, establishing in the chip industry for decades to see its image 18A, two sources reported.
(Jeffrey Dastin, Max A. Cherney and Stephen Nellis Reports in San Francisco; Edited by Kenneth Li and Matthew Lewis)
