They are apparently selling everything they can produce. Alot of that stuff is reportedly high-margin, so a good way to maximize profits is to make more stuff.
1. Assuming their 7nm is on schedule , they are not far behind, and if needed, roughly the same time as TSMC for HP node. ( Although I doubt it because if I remember correctly Intel has yet to put down / increase orders for their EUV Scanners, and I bet Samsung and TSMC will be grabbing most of it )
2. The cost of new process is going to increase whether they sell the same amount of CPU or even more with GPU. They need capacity. ( And they were again very late to increase capacity )
3. Process node are their BnB. Intel has CPU to continue to fund the Node development, Samsung has NAND and DRAM to fund their Custom Fab, TSMC is just funding it via their own business.
Regarding #1, if Intel's 7nm node is as dense as they have announced (~238 million transistors per mm^2) it will be quite denser than TSMC's 5nm node (I have read numbers around 180 MTr/mm^2), perhaps around as dense as TSMC's 3/4nm node or a bit less dense than that. I strongly doubt Intel will release 7nm based CPUs before 2022 though, by which time TSMC should have its 3/4nm node ready for orders, assuming high volume release of their first gen 5nm in 2020 and their second gen 5nm+ in 2021.
By the way, at Intel's 7nm node and at TSMC's 3/4nm node (and at Samsung's 2/3nm), apart from going smaller it is also expected that GAA (Gate All Around) tech will be adopted, and possibly even III-V semiconductors. The latter is still not likely, but GAA-FET transistors are apparently a certain bet.
This is why I dislike the nm rating - because it only realistic base on who makes the node process - I know it more than just density of transistors - it technically is judge also by gate design.
CPU actually depends also on more than just node also - but how the architexture of cpu is designed - like execution units and such.
What proof do you have on this - this could mean just the demand is higher than supply and will indicated why it needs to spend $11 billion on new Fab. That does not sound like a bad thing but a good thing.
They have several 10nm fabs producing zero chips for several years when they should have been producing hundreds of millions. If 10nm actually worked then they wouldn't be in this terrible situation. If you look at the news, Intel looks like a head-less chicken: fired their CEO, cancelled many product lines, still don't have 10nm working, and released nothing new apart from a few overpriced overclocked CPUs for crazy fanboys. And you believe all this is a good thing?!?
Process nodes are Intel's bread and butter. They messed up with 10nm. Intel is doing very well financially and their business has been very good. That shows you how strong of a position Intel is in such that they can have such a screw up and still have a very good business. Intel would have to really mess up to not have the money in 10 years. Their business might erode but it is not going to happen overnight.
I agree. This is how Intel dominated the previous years since their last screw up, the Pentium 4. Hard to tell what is going on with Intel but I feel this is all intentional. They'd probably saved some money not investing for the latest lithography to fund their GPU R&D.
Because Intel is getting hammered by AMD on one side and ARM on the other. Their process will right itself by shear R&D muscle and Intel needs to move to being a foundry first company so they can increase revenue by producing chips for third parties like Apple or Qualcomm ect.
nah. remember: all of these "chip companies" actually get their tooling from ASML, et al, so none of them has any real advantage over the others. to the extent that Intel/AMD/ARM can invent a new architecture (not bloody likely), there's not much they can do. even if they did, wouldn't that mean a whole new fabrication process that looks nothing like today? and what happens, if/when, somebody figures out how to do deterministic computing with q quantum computer? assuming such can be built to scale?
IOW, Intel etc. are at the mercy of external forces.
Country-of-manufacture diversity. Suppose international politics moves away from free trade toward shifting, high tarriffs across certain borders. To adapt to shifting tarriffs, a multinational company needs diverse factory locations and flexible material flows that minimize costs including tarriffs. High tarriffs can be significant costs. A shift to a high tarriff can force a business to shutdown a factory located in an unfavorable place relative to its customers.
"coal mine technician, now working for Clipper Windpower"
ain't nearly enough of those kind to offset the loss of China. the massive tax cut (you remember that) hasn't put $4,000 in the pockets of the middle class.
fact is, iPhone (and other hardware?) is falling off a cliff. income concentration continues unabated here and around the world. aka, aggregate demand is stalled and will stay that way until the middle class re-appears. and it's not just IMF/ECB/Fed/other-left-wing-pundits calling growth in danger, just look at corporates' statements. Intel is behaving as an extreme outlier.
200M iOS devices with Intel Modem next year, Intel ship roughly ~270M CPU per year. Even the die size of Modem is smaller, it is still an substantial amount of fab requirement.
Ever increasing usage in Cloud, ML, AI. And lots of Server upgrade cycle coming.
Intel GPU, also for GPGPU as well.
None of these are surprises, Intel Fab capacity just wasn't prepared for it. Which is why many are saying their management were sub par.
Making a CPU not just about process - and 10nm process coming this year can not be based on Cannon Lake.
2. The cost of new process is only going to explode.
It is nature ever going smaller process to is going to cost more.
3. They are not TSMC, process node is not their BnB. Yes, they have money right now, but what in 10 years?
TSMC has process issues - which they state is because of chemical problem but it could be more than just. It is good thing that has more business that just the process node so - They have proven even with struggles of 10nm that they can prosper with out it.
"TSMC has process issues - which they state is because of chemical problem but it could be more than just"
It would be weird for them to have "process Issues" on their 16/12nm, which is pretty mature at the moment, while being fine on their 7nm node (the bleeding edge one). So, contaminated chemicals sounds reasonable. Also, read their investor disclaimers. They have to be truthful in those (or they can be sued).
Seems risky, in a politically unstable part of the world. One rocket attack and that place is destroyed. Seems like the U.S. is a better place for an $11B plant.
without $$$billions from Uncle Sugar??? the US taxpayer, directly and indirectly, is paying for such off-shoring. such a deal!
"U.S. senators who just returned from a trip to Israel called on Tuesday for an increase in the $38 billion in military aid the United States is currently providing Israel, signaling support for more funds for Israeli missile systems. " here: https://www.reuters.com/article/us-usa-israel-defe...
read the story, and many others. Israel, for good or bad reasons, gets more military money than any other country. thus, the US taxpayer subsidizes this 'defense' of Intel. you tax dollars at work.
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eva02langley - Tuesday, January 29, 2019 - link
I wonder how Intel, in this moment, think having more fabs is a good thing.1. Their process is behind.
2. The cost of new process is only going to explode.
3. They are not TSMC, process node is not their BnB.
Yes, they have money right now, but what in 10 years?
jtd871 - Tuesday, January 29, 2019 - link
They are apparently selling everything they can produce. Alot of that stuff is reportedly high-margin, so a good way to maximize profits is to make more stuff.iwod - Tuesday, January 29, 2019 - link
1. Assuming their 7nm is on schedule , they are not far behind, and if needed, roughly the same time as TSMC for HP node. ( Although I doubt it because if I remember correctly Intel has yet to put down / increase orders for their EUV Scanners, and I bet Samsung and TSMC will be grabbing most of it )2. The cost of new process is going to increase whether they sell the same amount of CPU or even more with GPU. They need capacity. ( And they were again very late to increase capacity )
3. Process node are their BnB. Intel has CPU to continue to fund the Node development, Samsung has NAND and DRAM to fund their Custom Fab, TSMC is just funding it via their own business.
Santoval - Wednesday, January 30, 2019 - link
Regarding #1, if Intel's 7nm node is as dense as they have announced (~238 million transistors per mm^2) it will be quite denser than TSMC's 5nm node (I have read numbers around 180 MTr/mm^2), perhaps around as dense as TSMC's 3/4nm node or a bit less dense than that.I strongly doubt Intel will release 7nm based CPUs before 2022 though, by which time TSMC should have its 3/4nm node ready for orders, assuming high volume release of their first gen 5nm in 2020 and their second gen 5nm+ in 2021.
By the way, at Intel's 7nm node and at TSMC's 3/4nm node (and at Samsung's 2/3nm), apart from going smaller it is also expected that GAA (Gate All Around) tech will be adopted, and possibly even III-V semiconductors. The latter is still not likely, but GAA-FET transistors are apparently a certain bet.
HStewart - Wednesday, January 30, 2019 - link
This is why I dislike the nm rating - because it only realistic base on who makes the node process - I know it more than just density of transistors - it technically is judge also by gate design.CPU actually depends also on more than just node also - but how the architexture of cpu is designed - like execution units and such.
Jorgp2 - Tuesday, January 29, 2019 - link
I mean Intel is cutting consumer orders to be able to fill high-margin orders.They aren't AMD
HStewart - Tuesday, January 29, 2019 - link
High margin orders must be laptop creators like Dell, Lenovo, HP, Asus and many others.Just take a trip into you local BestBuy and go to laptop section.
fazalmajid - Wednesday, January 30, 2019 - link
No, they can’t even fill all the server Xeon orders, despite that being much lower volume than laptop or even desktop CPUsHStewart - Wednesday, January 30, 2019 - link
What proof do you have on this - this could mean just the demand is higher than supply and will indicated why it needs to spend $11 billion on new Fab. That does not sound like a bad thing but a good thing.Wilco1 - Sunday, February 3, 2019 - link
They have several 10nm fabs producing zero chips for several years when they should have been producing hundreds of millions. If 10nm actually worked then they wouldn't be in this terrible situation. If you look at the news, Intel looks like a head-less chicken: fired their CEO, cancelled many product lines, still don't have 10nm working, and released nothing new apart from a few overpriced overclocked CPUs for crazy fanboys. And you believe all this is a good thing?!?Yojimbo - Wednesday, January 30, 2019 - link
Process nodes are Intel's bread and butter. They messed up with 10nm. Intel is doing very well financially and their business has been very good. That shows you how strong of a position Intel is in such that they can have such a screw up and still have a very good business. Intel would have to really mess up to not have the money in 10 years. Their business might erode but it is not going to happen overnight.zodiacfml - Wednesday, January 30, 2019 - link
I agree. This is how Intel dominated the previous years since their last screw up, the Pentium 4.Hard to tell what is going on with Intel but I feel this is all intentional.
They'd probably saved some money not investing for the latest lithography to fund their GPU R&D.
Samus - Wednesday, January 30, 2019 - link
The easy answer: Israel is obviously giving them an exceptional deal to build there.SquarePeg - Wednesday, January 30, 2019 - link
Because Intel is getting hammered by AMD on one side and ARM on the other. Their process will right itself by shear R&D muscle and Intel needs to move to being a foundry first company so they can increase revenue by producing chips for third parties like Apple or Qualcomm ect.FunBunny2 - Thursday, January 31, 2019 - link
nah. remember: all of these "chip companies" actually get their tooling from ASML, et al, so none of them has any real advantage over the others. to the extent that Intel/AMD/ARM can invent a new architecture (not bloody likely), there's not much they can do. even if they did, wouldn't that mean a whole new fabrication process that looks nothing like today? and what happens, if/when, somebody figures out how to do deterministic computing with q quantum computer? assuming such can be built to scale?IOW, Intel etc. are at the mercy of external forces.
Zingam - Thursday, January 31, 2019 - link
I guess they are going to employ Syrian refugees, right?FunBunny2 - Thursday, January 31, 2019 - link
ouch. or unemployed coal miners and open hearth furnace operators.Gc - Thursday, January 31, 2019 - link
Country-of-manufacture diversity. Suppose international politics moves away from free trade toward shifting, high tarriffs across certain borders. To adapt to shifting tarriffs, a multinational company needs diverse factory locations and flexible material flows that minimize costs including tarriffs. High tarriffs can be significant costs. A shift to a high tarriff can force a business to shutdown a factory located in an unfavorable place relative to its customers.Notmyusualid - Friday, February 1, 2019 - link
As I understand it, simply, they are not able to meet current customer demands, and thus need to expand manufacturing.Not a difficult concept, eh?
Old_Fogie_Late_Bloomer - Tuesday, January 29, 2019 - link
I believe you mean "particulars of the fab".FunBunny2 - Tuesday, January 29, 2019 - link
with the Chinese consumer imploding, where is the increase in aggregate demand going to come from? unemployed coal miners?boeush - Tuesday, January 29, 2019 - link
"unemployed coal miners?"More likely, gainfully employed wind turbine technicians...
Samus - Wednesday, January 30, 2019 - link
I know someone who used to be a coal mine technician, now working for Clipper Windpower in Delaware for twice as much salary :PFunBunny2 - Wednesday, January 30, 2019 - link
"coal mine technician, now working for Clipper Windpower"ain't nearly enough of those kind to offset the loss of China. the massive tax cut (you remember that) hasn't put $4,000 in the pockets of the middle class.
dromoxen - Saturday, February 2, 2019 - link
thats just hot air?boeush - Tuesday, January 29, 2019 - link
Also: "consumer imploding" == economy grows at ONLY 6.3% annually, as opposed to the "non-imploding" 6.9%:https://abcnews.go.com/beta-story-container/Busine...
In other words, "exploding" == "non-imploding", while "exploding somewhat less intensely" == "imploding"...
FunBunny2 - Wednesday, January 30, 2019 - link
fact is, iPhone (and other hardware?) is falling off a cliff. income concentration continues unabated here and around the world. aka, aggregate demand is stalled and will stay that way until the middle class re-appears. and it's not just IMF/ECB/Fed/other-left-wing-pundits calling growth in danger, just look at corporates' statements. Intel is behaving as an extreme outlier.ksec - Wednesday, January 30, 2019 - link
200M iOS devices with Intel Modem next year, Intel ship roughly ~270M CPU per year. Even the die size of Modem is smaller, it is still an substantial amount of fab requirement.Ever increasing usage in Cloud, ML, AI. And lots of Server upgrade cycle coming.
Intel GPU, also for GPGPU as well.
None of these are surprises, Intel Fab capacity just wasn't prepared for it. Which is why many are saying their management were sub par.
HStewart - Tuesday, January 29, 2019 - link
1. Their process is behind.Making a CPU not just about process - and 10nm process coming this year can not be based on Cannon Lake.
2. The cost of new process is only going to explode.
It is nature ever going smaller process to is going to cost more.
3. They are not TSMC, process node is not their BnB.
Yes, they have money right now, but what in 10 years?
TSMC has process issues - which they state is because of chemical problem but it could be more than just. It is good thing that has more business that just the process node so - They have proven even with struggles of 10nm that they can prosper with out it.
frenchy_2001 - Wednesday, January 30, 2019 - link
"TSMC has process issues - which they state is because of chemical problem but it could be more than just"It would be weird for them to have "process Issues" on their 16/12nm, which is pretty mature at the moment, while being fine on their 7nm node (the bleeding edge one).
So, contaminated chemicals sounds reasonable.
Also, read their investor disclaimers. They have to be truthful in those (or they can be sued).
Supercell99 - Wednesday, January 30, 2019 - link
Seems risky, in a politically unstable part of the world. One rocket attack and that place is destroyed. Seems like the U.S. is a better place for an $11B plant.Eliadbu - Wednesday, January 30, 2019 - link
In case of wartime they have guarantee from the state that a battery of air defence would be stationed near the fab.Gunbuster - Wednesday, January 30, 2019 - link
Even with 4 Iron Dome turrets planted on the roof I would not consider it a wise place to put 11 billion dollars worth of sprawling factory...FunBunny2 - Wednesday, January 30, 2019 - link
"guarantee from the state "without $$$billions from Uncle Sugar??? the US taxpayer, directly and indirectly, is paying for such off-shoring. such a deal!
"U.S. senators who just returned from a trip to Israel called on Tuesday for an increase in the $38 billion in military aid the United States is currently providing Israel, signaling support for more funds for Israeli missile systems. "
here: https://www.reuters.com/article/us-usa-israel-defe...
your tax dollars at work.
Zingam - Thursday, January 31, 2019 - link
It is a politically (semitically) influenced decision and not a business one. You could bet on that!Zingam - Thursday, January 31, 2019 - link
It's their money. It's their problem. If you think that it is US money you are naive.FunBunny2 - Saturday, February 2, 2019 - link
read the story, and many others. Israel, for good or bad reasons, gets more military money than any other country. thus, the US taxpayer subsidizes this 'defense' of Intel. you tax dollars at work.