> This is IBM’s fifth rebirth in its Herman Hollerith built punch card machines to do the 1890 census in 1890, which is the true kernel of the company we know as Big Blue.
Intel seems 100% tied to its outcomes as a foundry now. If there is any disruption in chip prodution from Taiwan for example, I can see its stock doubling in price.
The immediate winners will be Samsung and Globalfoundries, since they have wide arrays of foundries with different processes (including specialized ones for automotive/avionics grade components, dram, cmos sensors, etc.), spare capacities, existing customers with designs tailored to their processes, and extensive experience in helping customers getting their designs ported.
Intel is going to fight an uphill battle with all these issues, it's likely that TSMC the other competitors can expand capacity faster than Intel can convince customers to gamble on them.
I would not. There is nothing to indicate Intel leadership is capable of executing. Bean counters are not the kind of leadership you need in a changing environment.
Isn't the whole problem that it wasn't QA'd out precisely because Intel no longer know how to ship good products? Sure Intel have the resources to make their customers whole on this screw up but the concern is that Intel have had a pattern of poor execution in the fast 10-15 years and this is just the most recent example.
There are few absolutes so stop trying to reduce the problem to one such as "Intel bad" because that's disingenuous.
It's really hard to reason about things until you hit large quantities of hardware in production, separate statistical failures from non-statistical failures, separate end user idiocy from real issues and do the analysis, then reproduce it conclusively. This is not helped by the target end of the market demand being interested in running things close to the line on boards kicked out by the lowest bidder. On top of that you have large vendors like Dell and Lenovo who take forever to feed information back on warranty claims because their end user support is fucking awful.
Basically it's very hard to reason about this pre-production despite every effort and QA step in the book being followed.
I am not reducing it to "Intel bad". There's tons of evidence of them having execution problems in recent years. Is it savable? Possibly. Intel is huge and has a good amount of time and support so they certainly have the resources to do so.
The available evidence that they are actually doing the right things to turn the ship around isn't that positive in my, or apparently many very large shareholders view though.
One of the videos from the well connected tech youtubers (I think it was GamersNexus) said that QA had caught the issue (if you push this bus too hard with voltage, there will be issues) but management ignored it because they needed to compete with AMD. There was also something about pushing previously binned i7 parts out as i9's by pushing the voltages to meet demand too. I'll see if I can find the reference a bit later.
Intel publishes much more information about their future roadmap than any other company in this industry.
During the last couple of years they have achieved in time all the product and process launches that had been announced with years in advance, up to Meteor Lake on the new Intel 4 CMOS process at the end of 2023 and Sierra Forest on the new Intel 3 CMOS process at the middle of 2024.
The only things that could be considered as under-achievements are the facts that in the Intel 4 process the maximum clock frequencies have been lower than hoped and the production yields are still low. Nevertheless, these 2 problems are not surprises. Every new CMOS process launched by Intel during the last decade has been affected exactly by these 2 problems, at least for its first year. For each such process, Intel has succeeded eventually to solve the problems, but they have always needed the experience of multiple years of production for that. With Intel 4 this will not happen, because it will not be used again for another product, being replaced by Intel 3, which probably incorporates whatever fixes were suggested by the experience with Intel 4.
So the financial problems of Intel are not caused by Intel failing to execute their roadmap.
Nevertheless, the bad financial results have been perfectly predictable from the Intel roadmap, as it had been known for years, because that roadmap does not attempt to achieve parity with the AMD server CPUs before the end of 2026 at the earliest.
The financial results of Intel have shown profits for the client CPUs. They have shown losses for their foundry, which have been unavoidable, due to their need to invest huge amounts of money to recover Intel's handicap vs. TSMC and due to the need to transfer a part of their chip production to TSMC, while they are developing their new processes.
They have also shown great losses for the server CPUs. The losses in server CPUs are likely to be caused by Intel having to cut their prices a lot when selling to big customers, in order to convince them to not buy the superior AMD server CPUs.
It is very likely that Intel will continue to have great losses in the foundry and in the server CPUs for at least one more year, based on their public roadmap. After that, their results will depend on how good the Intel 18A CMOS process will be in comparison with the competing CMOS processes of TSMC.
The Intel roadmap for manufacturing processes and for client CPUs has been decent. While some of the Intel choices may be undesirable for their customers, other choices would not have improved their financial results.
Where Intel could have conceived a much better roadmap is in server CPUs, where they have their greatest losses. When AMD launches a new microarchitecture, like now with Zen 5, after 3 or 4 months they also launch their server CPUs with that microarchitecture, like with AMD Turin later this year. On the other hand, when Intel launches a new microarchitecture in their client CPUs, like in the next couple of months with Lunar Lake and with Arrow Lake S, they follow with server CPUs using the same up-to-date microarchitecture usually only one or two years later, e.g. in the second half of 2026 in this case.
While the Lion Cove and Skymont cores of Lunar Lake and Arrow Lake S are competitive with Zen 5, the Intel server CPUs launched these days, Sierra Forest and Granite Rapids, continue to use cores that are only marginally better than the cores used in Alder Lake three years ago.
The new Granite Rapids server CPUs will be able to match the number of cores per socket of the AMD server CPUs, for the first time after many years. However, they will use cores not much better than Zen 4, which will be inferior to Zen 5.
This situation would have been easily avoided by Intel if they would have launched now only CPUs using their up-to-date cores, instead of using obsolete cores in their server CPUs.
The reason why AMD does not have this problem is because they design a single CPU chiplet that will be used both in their desktop and high-po...
I expect the problem is more that people disregard fundamental truths because they think macroeconomics supersedes realpolitik. It's a particularly HN-oriented tradition that leaves a lot of people with sore-looking opinions after the fact.
It's very widespread. But if you look past the stock trade and the pop-psychology, it's pretty clear that Intel today is on a different trajectory than they were 10 years ago. In that time they've changed CEOs, reframed their roadmap, kickstarted auxiliary businesses and invested in RISC development. The catastrophic potential of Intel losing desktop market share was overstated and over-anticipated. Now, cutting off their desktop segment is practically the most profitable route.
HN has a habit of jumping the gun on financials without accounting for what the market is doing or where things are going. Intel doesn't have the dominant position they used to, but their trajectory is heads-I-win-tails-you-lose levels of redundant. Their roadmap is the good kind of boring, and they're the only fab I know that has TSMC's flagship products in the crosshairs. We're desperately trying to declare Intel dead while already anticipating their resurrection; that suggests to me there's a good pulse left.
Could you please stop posting unsubstantive and/or flamebait comments? and also turn down the general grumpiness? You've unfortunately been doing these things repeatedly. They aren't what this site is for and destroy what it is for.
This is what a lot of people who have no idea about the semi industry miss because they get all their education from news headlines. Which is what I assume leads to Intel's massive stock drop. People voting on FUD, kind of like the opposite of the hype that pushed Nvidia to the moon, but when you asked investors who bought Nvidia, what Nvidia actually makes, most are clueless and only bought out of hype and FOMO.
Everyone assumes the world only needs 3nm chips because that's what TSMCs latest cutting edge node is and that's what they learned powers their iPhone, but the reality is the world runs on nodes much larger than that. To put this into perspective, the new TSMC fab being built in Germany will tape out 28/22nm nodes and then upgrade to 16/12 nm nodes mostly for robotics, industrial, IoT and especially automotive. Just let that sink in. Even Global Foundries is stuck at 12nm.
Intel's 4 process is cutting edge by comparison and plenty of international players who can't afford TSMC or Samsung would gladly pick up that node capacity for the right price.
Yh, 28+16 is basically pretty much all you need for industrial semis. The other key part I think is basically going to be military, I've watched an interview with one of the big wigs at Baikal and he claimed that the Russian miltech industry would be fully self-sustaining if there was domestic 28nm capacity.
I remember one comment from during covid when the supply chain was messed up (possibly from Intel) saying productivity could be improved a lot for non-leading edge chips by getting designs off relative ancient processes to relatively recent, which would let the industry modernize old fabrication plants. It requires work for that new design though, and moving away from thoroughly tried and tested
That was quite naive. The problem is there is little motivation to do that. The designs can't just be scaled down, they need to be recompiled from scratch with the target process' standard cells and verification. That work is expensive as fuck. Then there's packaging and managing the supply chain and data around it. Why bother when demand causes prices to go up? Just pocket the money and wait. If you spend that on more capacity and reengineering you just burn the money.
I never said what you're claiming. Please read comments carefully, assume good faith in the comments you read, and don't put words in my mouth.
Like I said, Intel's layoffs are a reaction to their stock tanking, and their stock tanking is due to investor behavior which is sometimes rational, but a lot of the times not.
But boring stuff has low margins. Intel has been living in a high-margin world at least since the 8086. They currently don't know how to survive on low margins. I'm not sure they can learn.
Devils Advocate: If there is no disruption in Taiwan, and TSMC continues to execute as it has, and Intel continues to execute as is has (not), then Intel might go to $0 or survive only because of government subsidies and military contracts.
NVIDIA, AMD, Apple and other companies seeking cutting edge performance will choose the most advanced node to stay competitive. Being the second best foundry has historically not been good business.
TSMC today has more than 60% of the foundry market share, and an estimated 80%+ market share for the leading edge.
If you exclude Intel themselves (although they also use TSMC now) and Samsung, TSMC is pretty much the sole supplier to the leading edge.
So, yes, TSMC has the capacity.
Your Boeing / Airbus analogy hinges on multiple factors. First, Airbus and Boeing have comparable capacity. Second, they have comparable products. Both are not true when you compare Intel and TSMC.
NVIDIA is heavily supply constrained. Why haven’t they sourced Intel or Samsung as second source?
Historically, there are also many other issues with Intel operating as foundry. Do you think NVIDIA and AMD will be happy to send their CPU and GPU designs to Intel for manufacturing? Independence was one of the main drivers why TSMC was founded. To have an independent supplier who does not compete with its customers.
It was a genuine question, I don’t follow the sector closely.
That said to poke at your answer a bit:
If nvidia is heavily supply constrained, wildly profitable, and strictly limited to TSMC doesn’t that dynamic lead to other customers being pushed aside? If so, doesn’t that open an opportunity for Intel if they can execute?
>Theres also talk about their shift to GPU, maybe Battle Mage will deliver in this year
Considering the stock tanking and the announced layoffs, I fear Battle Mage will be unfortunate collateral damage along the line.
Really unfortunate timing as that was the only competition we could hope for to the Nvidia and AMD GPU duopoly who jacked up their prices, and Intel was actually committed to the new GPUs constantly pushing updates and fixes.
There's no point in rooting for Intel's downfall here as some people seem to take pleasure in, as then AMD will just jack up their prices as they've done in the past, since they're a business not a charity, and only acted nice to consumers while they were the underdog but will not hesitate to milk us dry the moment they own the market like Intel and Nvidia did.
Intel has cranked up its dev support and market cornering machine in the past. Let’s see if it can do that again without a near-monopoly market status.
And AI will pop soon, there's reports that the AI companies and their suppliers have dumped billions in R&D and investments but are slow to start earning that back.
Curious what you (and others) mean with "AI bubble popping". I mean, in practice?
Crypto was a bubble (or well, a hype) in that almost none of the proposed applications ever looked remotely plausible, even to a superficial assessment. (Meanwhile, BTC is still around $50k).
But the "AI bubble"? Are we going to discover that none of the LLM-based applications that are being developed now actually works (despite many having already been working for years, e.g. copilot) AND at the same time that further improvements, both in the LLMs themselves and in the code surrounding them, are impossible- in other words, that LLMs, after four or five years of development at most are already a mature technology? Are we not going to find any new use cases for agents that have almost the skills of specialists, minus some kind of cognitive impairment? Honest question, I don't understand.
>Curious what you (and others) mean with "AI bubble popping"
Large corps and FAANGS are spending billions on Nvidia HW and on ML training but all those LLMs aren't earning them any money, in fact they're still loosing money just to capture the market share and consumer mindset, but there's doesn't seem to be a profit light at the end of the tunnel.
Once they've bled enough money with no chance of RoI, they'll put a halt on ML expansion and stop buying Nvidia HW. Intel entering at that point would be suicide.
True, those LLMs are not earning them any money, but do you think they lack future applications (and future improvements) that would be worth the money those companies are spending now?
Like I said, there's no proof of massive profitability potential in the near future. You can dream about an optimistic utopic future for those LLMs but the expense bills are real and they are right now.
I've yet to see future applications that would justify the current spend. That doesn't mean they don't exist, but I'm skeptical that they exist to the extent they would need to in order to justify the hundreds of billions of spend.
The spend seems to be based on faith that there will be some kind of major breakthrough...but that does appear to be entirely faith based. We don't have any evidence to indicate that it's likely.
> The spend seems to be based on faith that there will be some kind of major breakthrough...
I think that rather than being a matter of having or not faith in a future breakthrough, the difference is between those who believe that there's already been a major breakthrough in the last few years and those who deny it.
IMO if they released a mid level performer workstation card with 48-64GB of VRAM for a reasonable price (my understanding is standard GDDR6 is not overly expensive), say under $1k usd, they would not only fly off the shelves, but they would also gain OSS efforts improving popular packages. Products like the NVIDIA A6000 are so insanely overpriced, I’m still baffled why larger VRAM cards haven’t come out more competitive.
> I’m still baffled why larger VRAM cards haven’t come out more competitive.
Because that would eat into the market of hyper expensive dedicated AI accelerator cards. Wasn't it obvious?
At TSMC you'll pay 20 per square inch of silicon(number I made up for exemplification), would you rather a) print a GPU on it and sell it to consumers for $800 or b) print an AI accelerator on it and sell it to datacenters for $8000?
It's really that simple. What company you know that says no to making more money?
I don't think Intel can afford to not continue in the GPU segment. They must continue developing there. It's a growth industry with high demand and good margins, and cancelling their gpi stuff saves them a billion now and costs them the whole company in 10 years.
Would be great to see something that rivals the Strix Halo and the Z1 at apologetic prices :)
Right now everyone's still busy shoving the not-very-efficient N100 into every possible product that exists and making up some new ones too, while half of them end up underperforming from improper cooling.
69 comments
[ 3.6 ms ] story [ 185 ms ] threadOr at least a proof read before hitting publish.
> This is IBM’s fifth rebirth in its Herman Hollerith built punch card machines to do the 1890 census in 1890, which is the true kernel of the company we know as Big Blue.
What?
Intel is going to fight an uphill battle with all these issues, it's likely that TSMC the other competitors can expand capacity faster than Intel can convince customers to gamble on them.
I would not. There is nothing to indicate Intel leadership is capable of executing. Bean counters are not the kind of leadership you need in a changing environment.
It's really hard to reason about things until you hit large quantities of hardware in production, separate statistical failures from non-statistical failures, separate end user idiocy from real issues and do the analysis, then reproduce it conclusively. This is not helped by the target end of the market demand being interested in running things close to the line on boards kicked out by the lowest bidder. On top of that you have large vendors like Dell and Lenovo who take forever to feed information back on warranty claims because their end user support is fucking awful.
Basically it's very hard to reason about this pre-production despite every effort and QA step in the book being followed.
The available evidence that they are actually doing the right things to turn the ship around isn't that positive in my, or apparently many very large shareholders view though.
During the last couple of years they have achieved in time all the product and process launches that had been announced with years in advance, up to Meteor Lake on the new Intel 4 CMOS process at the end of 2023 and Sierra Forest on the new Intel 3 CMOS process at the middle of 2024.
The only things that could be considered as under-achievements are the facts that in the Intel 4 process the maximum clock frequencies have been lower than hoped and the production yields are still low. Nevertheless, these 2 problems are not surprises. Every new CMOS process launched by Intel during the last decade has been affected exactly by these 2 problems, at least for its first year. For each such process, Intel has succeeded eventually to solve the problems, but they have always needed the experience of multiple years of production for that. With Intel 4 this will not happen, because it will not be used again for another product, being replaced by Intel 3, which probably incorporates whatever fixes were suggested by the experience with Intel 4.
So the financial problems of Intel are not caused by Intel failing to execute their roadmap.
Nevertheless, the bad financial results have been perfectly predictable from the Intel roadmap, as it had been known for years, because that roadmap does not attempt to achieve parity with the AMD server CPUs before the end of 2026 at the earliest.
The financial results of Intel have shown profits for the client CPUs. They have shown losses for their foundry, which have been unavoidable, due to their need to invest huge amounts of money to recover Intel's handicap vs. TSMC and due to the need to transfer a part of their chip production to TSMC, while they are developing their new processes.
They have also shown great losses for the server CPUs. The losses in server CPUs are likely to be caused by Intel having to cut their prices a lot when selling to big customers, in order to convince them to not buy the superior AMD server CPUs.
It is very likely that Intel will continue to have great losses in the foundry and in the server CPUs for at least one more year, based on their public roadmap. After that, their results will depend on how good the Intel 18A CMOS process will be in comparison with the competing CMOS processes of TSMC.
The Intel roadmap for manufacturing processes and for client CPUs has been decent. While some of the Intel choices may be undesirable for their customers, other choices would not have improved their financial results.
Where Intel could have conceived a much better roadmap is in server CPUs, where they have their greatest losses. When AMD launches a new microarchitecture, like now with Zen 5, after 3 or 4 months they also launch their server CPUs with that microarchitecture, like with AMD Turin later this year. On the other hand, when Intel launches a new microarchitecture in their client CPUs, like in the next couple of months with Lunar Lake and with Arrow Lake S, they follow with server CPUs using the same up-to-date microarchitecture usually only one or two years later, e.g. in the second half of 2026 in this case.
While the Lion Cove and Skymont cores of Lunar Lake and Arrow Lake S are competitive with Zen 5, the Intel server CPUs launched these days, Sierra Forest and Granite Rapids, continue to use cores that are only marginally better than the cores used in Alder Lake three years ago.
The new Granite Rapids server CPUs will be able to match the number of cores per socket of the AMD server CPUs, for the first time after many years. However, they will use cores not much better than Zen 4, which will be inferior to Zen 5.
This situation would have been easily avoided by Intel if they would have launched now only CPUs using their up-to-date cores, instead of using obsolete cores in their server CPUs.
The reason why AMD does not have this problem is because they design a single CPU chiplet that will be used both in their desktop and high-po...
By selling defective products
HN has a habit of jumping the gun on financials without accounting for what the market is doing or where things are going. Intel doesn't have the dominant position they used to, but their trajectory is heads-I-win-tails-you-lose levels of redundant. Their roadmap is the good kind of boring, and they're the only fab I know that has TSMC's flagship products in the crosshairs. We're desperately trying to declare Intel dead while already anticipating their resurrection; that suggests to me there's a good pulse left.
If you wouldn't mind reviewing https://news.ycombinator.com/newsguidelines.html and taking the intended spirit of the site more to heart, we'd be grateful.
This is what a lot of people who have no idea about the semi industry miss because they get all their education from news headlines. Which is what I assume leads to Intel's massive stock drop. People voting on FUD, kind of like the opposite of the hype that pushed Nvidia to the moon, but when you asked investors who bought Nvidia, what Nvidia actually makes, most are clueless and only bought out of hype and FOMO.
Everyone assumes the world only needs 3nm chips because that's what TSMCs latest cutting edge node is and that's what they learned powers their iPhone, but the reality is the world runs on nodes much larger than that. To put this into perspective, the new TSMC fab being built in Germany will tape out 28/22nm nodes and then upgrade to 16/12 nm nodes mostly for robotics, industrial, IoT and especially automotive. Just let that sink in. Even Global Foundries is stuck at 12nm.
Intel's 4 process is cutting edge by comparison and plenty of international players who can't afford TSMC or Samsung would gladly pick up that node capacity for the right price.
Add to that those older processes are more mature, having been refined for decades, get higher yields, and are far cheaper as well.
I guess intel lays off another 15% of people because of ... 'FUD' and 'people who have no idea about the semi industry'
Yea.
Also look at the market tank. What's the usual reaction to that? Trim costs to improve shareholder appearance.
Like I said, Intel's layoffs are a reaction to their stock tanking, and their stock tanking is due to investor behavior which is sometimes rational, but a lot of the times not.
How else am I supposed to interpret that paragraph?
They need the layoffs because all their competition have fewer employees. Intel is simply bloated.
NVIDIA, AMD, Apple and other companies seeking cutting edge performance will choose the most advanced node to stay competitive. Being the second best foundry has historically not been good business.
This is an extreme scenario, of course.
People sometimes wonder why anyone is buying Boeing planes—it’s because it’s that or nothing. Airbus has no spare capacity.
If you exclude Intel themselves (although they also use TSMC now) and Samsung, TSMC is pretty much the sole supplier to the leading edge.
So, yes, TSMC has the capacity.
Your Boeing / Airbus analogy hinges on multiple factors. First, Airbus and Boeing have comparable capacity. Second, they have comparable products. Both are not true when you compare Intel and TSMC.
NVIDIA is heavily supply constrained. Why haven’t they sourced Intel or Samsung as second source?
Historically, there are also many other issues with Intel operating as foundry. Do you think NVIDIA and AMD will be happy to send their CPU and GPU designs to Intel for manufacturing? Independence was one of the main drivers why TSMC was founded. To have an independent supplier who does not compete with its customers.
That said to poke at your answer a bit:
If nvidia is heavily supply constrained, wildly profitable, and strictly limited to TSMC doesn’t that dynamic lead to other customers being pushed aside? If so, doesn’t that open an opportunity for Intel if they can execute?
If it will deliver and match Apples Mx designs in terms of energy eff and perf, then ARMs expansion on the client side will slow down, I guess.
No point in porting stuff for marginal gains since ISA does not matter as much as ppl think
https://chipsandcheese.com/2021/07/13/arm-or-x86-isa-doesnt-...
Theres also talk about their shift to GPU, maybe Battle Mage will deliver in this year
Considering the stock tanking and the announced layoffs, I fear Battle Mage will be unfortunate collateral damage along the line.
Really unfortunate timing as that was the only competition we could hope for to the Nvidia and AMD GPU duopoly who jacked up their prices, and Intel was actually committed to the new GPUs constantly pushing updates and fixes.
There's no point in rooting for Intel's downfall here as some people seem to take pleasure in, as then AMD will just jack up their prices as they've done in the past, since they're a business not a charity, and only acted nice to consumers while they were the underdog but will not hesitate to milk us dry the moment they own the market like Intel and Nvidia did.
Too risky to go all in on AI now when Nvidia already has a stronghold monopoly that even AMD can't break.
But the "AI bubble"? Are we going to discover that none of the LLM-based applications that are being developed now actually works (despite many having already been working for years, e.g. copilot) AND at the same time that further improvements, both in the LLMs themselves and in the code surrounding them, are impossible- in other words, that LLMs, after four or five years of development at most are already a mature technology? Are we not going to find any new use cases for agents that have almost the skills of specialists, minus some kind of cognitive impairment? Honest question, I don't understand.
Large corps and FAANGS are spending billions on Nvidia HW and on ML training but all those LLMs aren't earning them any money, in fact they're still loosing money just to capture the market share and consumer mindset, but there's doesn't seem to be a profit light at the end of the tunnel.
Once they've bled enough money with no chance of RoI, they'll put a halt on ML expansion and stop buying Nvidia HW. Intel entering at that point would be suicide.
The spend seems to be based on faith that there will be some kind of major breakthrough...but that does appear to be entirely faith based. We don't have any evidence to indicate that it's likely.
I think that rather than being a matter of having or not faith in a future breakthrough, the difference is between those who believe that there's already been a major breakthrough in the last few years and those who deny it.
Because that would eat into the market of hyper expensive dedicated AI accelerator cards. Wasn't it obvious?
At TSMC you'll pay 20 per square inch of silicon(number I made up for exemplification), would you rather a) print a GPU on it and sell it to consumers for $800 or b) print an AI accelerator on it and sell it to datacenters for $8000?
It's really that simple. What company you know that says no to making more money?
Right now everyone's still busy shoving the not-very-efficient N100 into every possible product that exists and making up some new ones too, while half of them end up underperforming from improper cooling.
That's more than Oprah! Oh, wait, pink slips also means getting fired. American English is a bit ambiguous at times.