| 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-power laptop CPUs and in their server CPUs. On the other hand, Intel duplicates their design and validation efforts by designing distinct chips for desktops and for servers. When AMD finishes the design of a chiplet, it is ready for both desktops and servers. Their server CPUs use a few months of additional testing, but that is all of the delay. It is not clear how the design work is organized at Intel, but it appears that there is not enough overlap in the design of the client CPUs and of the server CPUs, so the latter are finished only after one extra year or two. |
By selling defective products