According to a CNBC report, American chip giant Intel has begun mass-producing 18A process chips at its advanced wafer fab in Arizona, but currently, its only customer remains Intel itself, as it has yet to attract orders from external major clients.
The report points out that Intel's biggest challenge today is convincing other major chip design companies to outsource the manufacturing of their key products to Intel, yet its biggest competitor in this endeavor is TSMC.
Daniel Newman, CEO of the well-known technology industry analysis and research firm The Futurum Group, stated, "Many companies have invested significant capital in TSMC to ensure yield and wafer capacity, so they are unlikely to switch to Intel in the short term."
Intel's 18A process has roughly caught up with TSMC's 2-nanometer node in some metrics, such as transistor density. However, due to delays in previous process generations over the years, Intel is still fine-tuning process issues, resulting in relatively low yields for some 18A wafers.
Harvard Business School professor David Yoffie noted, "Yield is always an issue at advanced process nodes; this is not an uncommon situation." He added that TSMC also faced yield issues initially when producing Nvidia's Blackwell GPUs but quickly improved them.
Intel's strategy to return to the foundry business began in 2021 when Pat Gelsinger took over as CEO, but he stepped down in December last year. Chiang Li-wu, who succeeded as CEO in March this year, admitted in a memo that Intel had "invested too quickly and too much over the past few years without aligning with actual demand."
Yoffie also pointed out that Intel faces difficulties in finding customers for its advanced 18A process, primarily because the company acts as both a "chip designer" and a "product manufacturer." In the eyes of potential clients, Intel is both a partner and a competitor. Therefore, he suggested that Intel should spin off its foundry business into a separate company to handle these operations, thereby resolving this awkward situation.
Yoffie emphasized that completely separating the design and manufacturing businesses "would not only significantly increase Intel's chances of success but also give the United States a more stable and competitive position in the global semiconductor manufacturing landscape."
Recent reports indicate that AMD is considering using Intel for foundry services, and some analysts predict that Apple may once again outsource the production of some Mac chips to Intel by 2027.
