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  • Apple’s Leap of Faith: Intel Chip Deal Sparks Debate on Future of U.S. Chipmaking Industry

    Apple’s Leap of Faith: Intel Chip Deal Sparks Debate on Future of U.S. Chipmaking Industry

    Apple’s transition to Intel chips, as reported last week, displays a strategic move driven by necessity and ambition. However, industry experts suggest this is not a straightforward transition, as advanced Intel chips typically require two to three years to manufacture. Moreover, the translation of this shift into tangible benefits may take even longer due to the extensive and meticulous production process.

    This potential deal, which has not yet been officially confirmed by either party, could present a mutually beneficial opportunity. Intel has been striving to reestablish its reputation as a credible contract chipmaker, while Apple seeks additional manufacturing capacity. This comes in light of Apple’s current supplier, TSMC, grappling with increased Artificial Intelligence (AI) chip demand led by companies such as Nvidia.

    Supply issues have impacted iPhone sales, as Apple CEO Tim Cook noted in April. The prospective agreement with Intel aligns with the U.S strategy to bolster domestic chip manufacturing, using tariffs and incentives. Intel, holding a 10% stake in the company and having received a $5 billion investment from Nvidia on the request of President Donald Trump, is considered a critical player in this initiative.

    However, Malcolm Penn, CEO of chip research firm Future Horizons, offers a cautious perspective. “The very best-case scenario would see the first chips produced within two to three years. Designing an SoC (system on chip) of this complexity takes two years, with an additional four months needed for production cycle time to ramp up,” he explained. Penn underscores that this estimation is contingent on Intel’s technology being fully developed and its design tools sufficiently reliable for Apple to rely on. He termed the deal as “a shotgun wedding,” due to the high degree of faith and commercial risk involved.

    Intel’s Prospects with Apple

    Despite being late to the AI boom, Intel has made tentative strides, securing Tesla as a customer in April and potentially entering a significant partnership with Apple. Experts are split over which Intel manufacturing process Apple will select.

    While some predict Apple will follow Tesla onto Intel’s forthcoming 14A process, others foresee Apple prioritizing reliability over cutting-edge gains, potentially favoring 18A-P, a refined version of Intel’s most advanced process, or a reliable, older node such as Intel 3.

    Bob O’Donnell, an analyst at TECHnalysis Research, believes Apple might opt for Intel’s 14A process technology, expected to be available by 2028 or 2029. He notes that if this comes to fruition, it would mark a pivotal development for Intel’s foundry business and U.S-based semiconductor manufacturing more broadly.

    Turning Apple’s Vision into Reality

    Daniel Newman, CEO of tech research firm Futurum Group, suggests that the mass production of Apple-designed chips may not commence until late 2027 or early 2028. It is anticipated that initial efforts will concentrate on less critical components used in MacBook Air or certain iPad Pro models.

    Apple might adopt a cautious approach, initially testing Intel with lower-end products before entrusting them with their most essential chips, as per analysts. Intel, which has faced challenges with the timeline and quality of its chips, will need to meet Apple’s high yield expectations—a standard that TSMC has accustomed Apple to.

    Paul Meeks, head of tech research at Freedom Capital Markets, voices skepticism. “Investors are betting on flawless execution by Intel, a company that hasn’t delivered for about 20 years. While Intel seems to have made progress with its latest manufacturing process, we should all at least modestly discount a perfect outcome,” he warned.

    Questions & Answers

    What is the predicted timeline for the production of Intel chips for Apple?
    The best-case scenario predicts that the first chips could be produced within two to three years. However, the mass production of Apple-designed chips may not start until late 2027 or early 2028.

    What factors could impact this timeline?
    The timeline depends largely on whether Intel’s technology is fully developed and its design tools reliable enough for Apple to depend on. It is also contingent on Intel meeting Apple’s high yield expectations.

    What could be the implications of this shift for Apple and for U.S. semiconductor manufacturing?
    The shift could potentially provide Apple with the additional manufacturing capacity it seeks and help Intel rebuild its credibility as a contract chipmaker. If successful, it could also mark a significant development for U.S-based semiconductor manufacturing.

  • Intel will bring a performance-improving feature to its chips one year ahead of TSMC

    Intel will bring a performance-improving feature to its chips one year ahead of TSMC

    In October 2021, Intel CEO Pat Gelsinger said that Intel would reclaim process leadership from TSMC and Samsung Foundry by 2025. Intel is looking to challenge TSMC and Samsung Foundry in the contract foundry segment of the industry. A contract foundry takes the chip designs from fabless chip designers (fabless means that they do not own a fabrication facility, like Apple for example) and manufacturers the chip. TSMC is the global leader followed by Samsung Foundry.

    Currently, both TSMC and Samsung Foundry are shipping 3nm chips and in the second half of next year, both could be mass-producing 2nm chips. Later this year, according to The Motley Fool, Intel will be using its 20A process (equivalent to 2nm for TSMC and Samsung Foundry) which will be used to build Intel’s Arrow Lake PC chips. So at that point, Intel will have process leadership and that will only continue next year when Intel debuts its 18A process node, equivalent to 1.8nm when you compare it to TSMC and Samsung Foundry. The latter two will be debuting their 2nm node in the second half of next year.

    Everyone is expected to catch up with each other in 2027 when Intel’s 14A (1.4nm) joins 1.4nm output from TSMC and Samsung Foundry. The bottom line is that the size of the transistors used with these chips gets smaller as the process node shrinks. That means more transistors can fit inside a component. The more transistors inside a chip, typically the more powerful and/or energy efficient a chip is.

    But starting with its 20A production later this year, Intel will have a bit of a head start on TSMC and Samsung Foundry with a key feature that the American chipmaker calls PowerVia (also known as known as backside power delivery). TSMC is expected to use this technology with its N2P node which it will use starting in 2026. Samsung Foundry is supposedly going to use backside power delivery on a particular node launching next year, although Samsung Foundry has not confirmed this.

    So what is PowerVia? Most of the small wires that deliver power to a chip are found on top of all of the layers that make up a silicon component. As these chips become more powerful and complex, the wires on top that connect to power sources are competing with the wires that connect components. This results in wasted power and low efficiency.

    PowerVia moves the wires bringing power to the chips to the backside of the chip. As a result, clock speeds can increase by 6% resulting in greater performance. Add to that the increase in performance delivered by using a more advanced process node, and the result is a more powerful chip used to run a more powerful device.

    Intel CEO Gelsinger said, “I’ve bet the whole company on 18A.” Intel expects that the performance and efficiency of its 18A node will top TSMC’s best. Intel also inked a deal with Arm allowing Arm’s chip-designing customers to have low-power SoCs built using Intel’s 18A process node. Last month, Intel agreed to build a custom chip for Microsoft using its 18A process. Four unnamed large companies (it’s not clear whether Microsoft is one of the four) have signed on to have Intel produce their chips using the 18A process.

    Recently, Intel became the first company to take delivery of its $400 million High-NA Extreme Ultraviolet Lithography machine from Dutch manufacturer ASML. With billions of transistors stuffed inside application processors, the High-NA EUV can etch extremely thin circuitry patterns on silicon wafers.

    The older EUV machines have an aperture of .33 (equivalent to a resolution of 13nm), and the High-NA machines have an aperture of .55 (equivalent to a resolution of 8nm). With a higher resolution pattern transferred to a wafer, the foundry could avoid having to run a wafer through the EUV machine twice to add additional features saving both time and money. While TSMC and Samsung Foundry have both ordered one of the High-NA machines from ASML, Intel will probably get to use the time-saving lithography machine first.

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  • Intel denies new investment in Vietnam

    Intel denies new investment in Vietnam

    U.S. chip giant Intel has said that it had never announced any additional investment in Vietnam apart from the $1.5 billion investment it has already made so far.

    “After raising our investment to $1.5 billion in 2021, we have never made any official announcement of a new investment,” a representative said Wednesday.

    The U.S. chipmaker had shelved a plan to invest $1 billion more in Vietnam, citing anonymous sources. The news outlet first reported about the plan in February.

    Intel began its operation in Vietnam in 2006 with a chip manufacturing and testing factory in Ho Chi Minh City.

    The factory, Intel Products Vietnam, is one of 10 manufacturing hubs of the company globally.

    The facility, which employs 2,800 people, has shipped over 3 billion product units over 15 years of operation.
    Intel leaders committed to long-term investment in Vietnam in a meeting with Deputy Prime Minister Tran Luu Quang in October.

    Intel CEO Patrick Gelsinger told Prime Minister Pham Minh Chinh in May that the company would invest several more times in Vietnam in the future.

    The company is expanding its investment in chip packaging in Malaysia, one of Vietnam’s main competitors in attracting foreign direct investment.

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  • Intel gets confidence boost from anonymous customer pre-paying for 18A production

    Intel gets confidence boost from anonymous customer pre-paying for 18A production

    Last week, Intel CEO Pat Gelsinger reiterated his goal for Intel to take foundry leadership from TSMC by 2025. The executive said, “We’re 2.5 years into the transformation. Now, it’s gone the way I would have expected at the time in terms of rebuilding the company. You have to be much less skeptical about our ability to pull this off.” Intel not only had to watch as TSMC took its foundry leadership away, but it also saw TSMC’s largest customer, Apple, replace its Intel chips with M-series chips built by TSMC.
    During last week’s Deutsche Bank conference, Gelsinger stated that the 18A node will return process leadership to Intel. That node would be considered 1.8nm while TSMC and Samsung would be shipping at 2nm during the same time. The CEO also let it be known that Intel has received a large prepayment from a customer for Intel’s 18A capacity. This gives Intel the confidence to believe it is on the right track and will lead the company to speed up the build-out of 18A fabs.
    In the long term, Intel sees the contract foundry business as its biggest opportunity. One interesting comment made by Gelsinger is that Intel knows TSMC’s wafer costs, ASPs, and targets. With this knowledge, he says that Intel wants lower costs than TSMC to win business from the global foundry leader. He says that Intel is trying to get its internal cost structure in line with TSMC. To this end, Intel will study its metrics such as headcount per wafer start, and use more AI/Machine Learning to improve efficiency.
    Intel is still relying on TSMC to build parts of its next-generation ‘Meteor Lake’ chips. While Intel will use its Intel 4 node (7nm) to build the chip’s CPU tile, the GPU tile will use TSMC’s 5nm node. The chip’s SoC tile, an ultra-low-power tile that supports media, imaging, display, and the connection to memory, will be built on TSMC’s 6nm node as will the chip’s I/O Extender tile.
    As Tech journalist Leo Waldock notes in a post on X, “All that could be correct yet it still seems weird to me that Intel is buying tiles from TSMC for its own products while touting foundry services to 3rd parties. Eat your own dog food, no?”
    Will Intel make TSMC and Samsung Foundry squirm? Will Apple stay loyal to TSMC? Will geopolitical rumblings make TSMC customers worried enough to bring their business to another foundry? These are questions that we will have to wait to answer.
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  • Intel to pour more investment in Vietnam

    Intel to pour more investment in Vietnam

    Intel Corporation will continue to invest in Vietnam, Kim Huat Ooi, Vice President in Manufacturing, Supply Chain and Operations, and General Manager of Intel Products Vietnam told Tuoi Tre (Youth) Newspaper.

    The year 2022 has affirmed the importance of Vietnam to the U.S. semiconductor giant and vice versa, he said, adding that these performance and efficiency results underpin the need to inject more capital into the Southeast Asian country.

    By the end of 2021, the Intel Corporation had injected a total of $1.5 billion in Vietnam and it wants to keep investing and that is certainly what Intel will do, he said.

    Intel Products Vietnam (IPV) is now the largest of the four factories in terms of assembly and testing, he noted.

    Regarding the possibility that IPV will be upgraded to participate in more stages of the chip production process, he said that their current plan is to focus on packaging and testing.

    To attract more investors, it is necessary for the Vietnamese government to review the current business support programmes, especially the preferential tax rates, he said, elaborating that other countries such as the Philippines, Malaysia and Indonesia are making similar moves.

    These countries and Vietnam have focused on using corporate income tax programmes to support and attract investors. He cited the U.S. and European chip laws that have been approved as typical examples.

    The modernisation of incentive programmes to support businesses will be an essential action that the Government of Vietnam needs to adopt to assist businesses, along with the advantages of labour costs and political stability.

    According to Kim, the number of foreign companies in the Southeast Asian country will increase in the future. He also highlighted the necessity of solving such problems as government incentives and streamlining administrative procedures.

    The current model that businesses are moving towards must be resilient and geographically balanced, he added.

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  • Intel exec lauds Vietnam chip autonomy ambition

    Intel exec lauds Vietnam chip autonomy ambition

    Chip autonomy is an ideal aspiration but it is advisable to avoid setting too big goals in the immediate future, an Intel Products Vietnam executive has told the government.

    In 2006, the U.S. chipmaker became the first foreign high-tech investor in Ho Chi Minh City.

    “The past 17 years have been a miraculous journey,” Kim Huat Ooi, vice president and general manager of Intel Products Vietnam, said.

    “Vietnam has transformed and become much more prosperous. Foreign investors coming here all want to have a foothold and a solid launch pad in Vietnam.”

    A number of other major chip manufacturers too have set up plants in Vietnam, forming an open semiconductor supply chain.

    Some local technology companies such as FPT and Viettel are also investing in the sector, and hope to export large volumes of “Made in Vietnam” chips.

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    In April Prime Minister Pham Minh Chinh assigned the Ministry of Planning and Investment with developing a program for electronic chip production.

    Vietnam’s advantage

    Kim, who has nearly 40 years of experience in the semiconductor field, said when Intel entered Vietnam it had to import most raw materials, but now over 200 local suppliers were working with the plant, helping create a closed process for chip autonomy.

    “It is completely right that the Vietnamese Government and companies think big and are ambitious to be self-sufficient in chip sources. Some companies have designed very good microcontrollers for specific applications. Vietnam will have a big opportunity to make more chips.”

    Before it set up the plant in Vietnam, Intel was invited by many other countries in the neighborhood. One of the important reasons for Intel choosing to build the plant in Ho Chi Minh City was the stability of the Vietnamese political system.

    During the Covid pandemic, many supply chains around the world were broken, but the Intel Vietnam factory was still operating smoothly.

    In 2021, its exports surged by 25% from the pre-pandemic period.

    Vietnam remained stable even in the most challenging periods.

    “It can be seen that in future local supply chains will gradually form and be able to operate independently. As the amount of high-tech investment increases, production costs will decrease, bringing more opportunities for domestic enterprises.

    “The Vietnamese government can use this to accelerate its ambition to produce chips.”

    It was right to dream big but it was also necessary to avoid being too ambitious to invest in non-optimal areas and waste money.

    Each country should focus on areas where it had an advantage instead of spreading itself too thin. Chip production was resource-intensive.

    Local companies also needed to design chips appropriate for their actual capabilities and needs, he said.

    Another challenge was human resources since the chip industry required great technical and technological capability to cope with new problems.

    “If we look at the current education system in Vietnam, we are seeing that resources are mainly focused on bachelor’s training. To enter the chip industry, more researchers in post-graduate programs are needed.

    “To design chips, engineers need a lot of R&D skills.”

    However, though investing in human resources required time and money, it was definitely profitable in the long run.

    For this, Vietnam needed the right talent, and for this tertiary education should have new curriculums.

    Intel and other large foreign enterprises in Vietnam also paid special attention to linking up with universities to improve curriculums and foster talent.

    “Seventeen years ago we entered Vietnam and started looking for the first basic workers. Now our plant has continuously sent Vietnamese engineers to the U.S. to work and develop specialized technologies. Initiatives by local talent have been patented in the U.S., making an important contribution to improving the plant’s performance.”

    Besides manpower, special attention should be paid to infrastructure and traffic, like dealing with the electricity shortages in some parts in June.

    The shortage had been solved, but in the long term investors would need specific plans to ensure reliable power availability.

    After the pandemic many neighboring countries had come up with incentives to get major international investors to come and set up supply chains.

    Vietnam too should have appropriate policies to retain existing investors and attract new ones.

    “The world is changing. Many countries are emerging, attracting large investors back. In Vietnam, we are doing well. Intel wants to continue to invest and contribute to Vietnamese society.”

  • Intel vPro platform accelerates business productivity

    Intel vPro platform accelerates business productivity

    The Intel vPro platform offers a comprehensive solution for businesses to increase productivity, protect business assets and maintain business organizations to get over the Covid-19 pandemic.

    The long term effects of Covid-19 have forced the world to quickly find new ways to live safely with it while maintaining stable socio-economic activities.

    With the development of technology, online has become the mainstream form of activity, e-commerce has grown rapidly, while the digital platform has become the main communication channel. Nowadays, many employees are gradually choosing to work from home. IT organizations are going to control the changes between “Work from home” and “Work in the office.” Business leaders need security features as well as productivity improvement during Covid-19. That’s why Intel has released its 11th Gen Intel vPro platform.

    Intel vPro is a platform “built for business,” using 11th Gen – 12th Gen Intel Core. It is a set of hardware and firmware technologies utilized to build business computing endpoints.

    Intel vPro value proposition spans four pillars, and business decision-makers who standardize on the vPro platform can benefit from hardware-enhanced protection, advanced maintenance, and validated platforms, all with the performance headroom to handle a wide range of business workflows.

    The 11th Gen processors feature the all-new Intel Iris Xe graphics processor that delivers a huge jump in performance. These processors also have integrated both Intel Wi-Fi 6 and Thunderbolt 4, so users get the latest wireless and cable connectivity standards built-in. They also deliver an exceptional performance for workers who need to collaborate and be productive.

    Intel Hardware Shield enabled hardware-enhances security features with advanced threat protection, application and data protection and below-the-OS security. Advanced threat protection uses aggressive memory scanning and artificial intelligence to detect new threats like ransomware and crypto-mining.

    Application and data protection includes encryption acceleration along with other features to protect applications and login credentials from attacks. Below-the-OS security prevents attacks against the BIOS and other firmware to enable a secure hardware and firmware foundation for the operating system.

    Intel vPro Platform comes with Intel Active Management Technology (Intel AMT) that allows IT to establish a secure connection between IT and a vPro-based PC. Once that secure connection is established, IT can perform a lot of different tasks as part of AMT.

    Remote power control continues to be one of the most used features of Intel AMT. With this, IT is able to remotely control the power state of a PC. Businesses use this to automate afterhours patching while keeping energy costs down. They can turn PCs off at the end of the day, yet wake them during the night to perform security updates without impacting productivity. Once they complete the patching they can put the PCs back to sleep to save energy. Lastly, before the workday begins, they can wake those PCs so everything is running and ready when employees arrive.

    The other most popular feature is hardware KVM. We’re all familiar with software based tools that we can use to take control of PCs and see the screen and move the mouse to help fix a system. It’s a very powerful tool, but only if the software can run. When a PC can’t successfully boot, those software based tools are powerless. That’s where Active Management Technology really shines, because it has a hardware KVM built into the chips. Even if the PC cannot boot, IT can connect with full KVM support to remotely remediate the PC, even entering the BIOS while maintaining the KVM connection.

    Intel Endpoint Management Assistant extends the power of Intel AMT beyond the firewall. By using cloud-based management infrastructure, devices don’t need a functional VPN to receive support from IT. As long as the AMT-enabled PC can reach the cloud, IT can securely connect to and remotely control that PC. This also allows IT technicians themselves to do their job either onsite or remotely.

    The cloud-based infrastructure is also easier to deploy and scale than traditional on-premise infrastructure and can be controlled using a simple web interface. When you’re running Intel EMA combined with Intel AMT, not only can you fix corrupted applications but a corrupted VPN is no problem at all, and a corrupted OS can also be remediated remotely.

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  • Samsung rumored to begin mass production of 3nm chips next week

    Samsung rumored to begin mass production of 3nm chips next week

    Right now there are only two independent foundries that are able to manufacture cutting-edge chips. The companies are TSMC and Samsung Foundry. Independent foundries take chip designs created by other firms and build the actual chips off of that design. Both TSMC and Samsung are working on building chips using their 3nm process nodes. The smaller the process node used, the larger the number of transistors found inside a chip.
    This is important because the more transistors employed in a chip, the more powerful and energy-efficient that chip can be. Every two years or so, the process node gets smaller and more transistors fit inside an integrated circuit. This is the famous “Moore’s Law” that you’ve heard about, named after Intel and Fairchild semiconductor co-founder Gordon Moore. Remember, this is not an actual law and as smaller and smaller components are being built, this “observation” no longer can be fully counted on to double the transistor count every other year.
    Still, over time, you can see how “Moore’s Law” has forecast the incredible increase in processing capabilities over the years. Let’s take the iPhone X, which was released in November 2017 powered by the Apple A10 Bionic chipset. The latter carried 4.3 billion transistors in each chip. Now let’s move ahead to the 2021 iPhone 13 series which sports the A15 Bionic chipset. The A15 Bionic contains 15 billion transistors, up 27.1% from the 11.8 billion transistors employed by the A14 Bionic chip.
    So now Samsung and TSMC are battling for supremacy in the business of building chips for third-parties. TSMC is number one in most metrics and its customer list includes top tech firms such as Apple (its number one customer), MediaTek, Nvidia, Qualcomm, and others. But it appears, according to ExtremeTech, that Samsung will soon beat out TSMC by starting mass production of chips made using its 3nm process node next week with TSMC starting 3nm mass production later this year.
    Additionally, Samsung is going to use a new transistor structure on its 3nm chips called GAA or gate-all-around. With this structure, the flow of current is controlled by gates that contact the transistor on all four sides. TSMC will continue to use the FinFET structure which has been in place since the 22nm process node debuted. TSMC will finally scrap FinFET for GAA when it starts shipping 2nm chips in 2026.
    Samsung’s GAA design is called Multi-Bridge Channel Field Effect Transistor (MBCFET) also known as nanowires. This is one of only two different gate-all-around designs currently available with the second one known as GAAFET or nanowire.
    The report cites a major Korean news agency that says Samsung is expected to make a major announcement about its 3nm chip production shortly. It also notes that the move to gate-all-around from FinFet will reduce the area of a chip by 45% to help deliver a performance bump of 30% while reducing energy consumption by 50%. However, there is a big problem. Samsung was reportedly getting yields of only 10% to 20% at 3nm meaning that the vast majority of its 3nm chip dies cut from a wafer could not pass quality control.
    Back in February, a report indicated that Samsung’s yield on 4nm production was only 35% resulting in Samsung losing some business from chip designer Qualcomm. The latter supposedly moved some of those orders to TSMC. However, if Samsung Foundry is about to announce the start of high volume manufacturing (HVM) at the 3nm process node, one could come to the conclusion that Samsung Foundry has improved its 3nm yield.
    Speaking of 3nm, TSMC’s major customers such as AMD, Apple, Broadcom, Intel, MediaTek, Nvidia, and Qualcomm, have started to queue up for 3nm capacity. And next on the horizon, of course, is the 2nm process node that both TSMC and Samsung are working on. Another name is expected to join TSMC and Samsung on the list of  cutting-edge foundries. Intel Chief Executive Pat Gelsinger has announced that the American company will regain process leadership from Samsung and TSMC by 2025.

     

  • Chip shortage is still a thing says Intel CEO Gelsinger

    Chip shortage is still a thing says Intel CEO Gelsinger

    Just because we don’t constantly hear about it as much anymore doesn’t mean that the global chip shortage has ended; when it comes to chips, the world isn’t all of a sudden “in the chips,” according to Intel CEO Pat Gelsinger who spoke Friday on CNBC’s “TechCheck.” The executive says that important tools used in the chip manufacturing process are not readily available keeping production capacities in check.
    With foundries unable to expand production capacity for their fabs, Gelsinger sees the chip shortage lasting longer than originally thought. “That’s part of the reason that we believe the overall semiconductor shortage will now drift into 2024, from our earlier estimates in 2023, just because the shortages have now hit equipment and some of those factory ramps will be more challenged,” the Intel CEO said.

    Intel, which has promised to regain “process performance leadership” by the end of 2024, has created a road map that includes taking delivery of ASML’s next-generation extreme ultraviolet lithography (EUV) machine. The $150 million machine uses highly polished mirrors to help focus ultraviolet light allowing it to etch circuitry patterns onto a wafer.
    With billions of transistors deployed on chipsets these days, lithography machines need to be able to create patterns that are fractions of the width of a human hair to help foundries manufacture cutting-edge chips. Intel will be the first foundry to use the new machines that raise their numerical aperture from .33NA to .55NA. This means that the machine can collect more light to help it create the circuitry patterns on the wafers that are used to build faster and more energy-efficient integrated circuits.
    Returning to process leadership means that Intel has to continue spending to build new fabs in the U.S. and Europe. The executive says, “We’ve really invested in those equipment relationships, but that will be tempering the build-out of capacity for us and everybody else, but we believe we’re positioned better than the rest of the industry.”
    Before speaking on CNBC, Gelsinger previously said that a supply-demand balance in the chip industry would take place in 2023. Intel did report first-quarter revenue and earnings last week that topped expectations on Wall Street although its estimates for the second quarter came in below analyst’s forecasts. Over the last week, Intel’s shares declined 8.6% from $93 to $85.
    The top two contract foundries in the world that take chip designs created by other companies and turn them into the final components are TSMC and Samsung. The former is known for building the chips designed by Apple including its A-Series and M-Series chips. Unlike TSMC and Samsung, Intel’s foundries usually produce components that Intel itself had designed.
    With two new fabs being built in Arizona, Intel is taking the business model perfected by TSMC and is bringing it to the U.S. But that doesn’t mean that TSMC won’t be a competitor. The Taiwan-based company is building its own plant in Arizona that will turn out 5nm chips by 2024.
    Tech firms are expected to embrace the possibility of having Intel produce chips based on their designs without fear that a geopolitical event will force TSMC to shut its factories in Taiwan and create a massive bottleneck that would make the current chip shortage feel like a walk in the park.
    Creating a valid supply chain for chips in the U.S. and making the country self-sufficient is a goal that the U.S. has been trying to achieve. China too has a goal to become self-sufficient when it comes to building chips. After the U.S. used its export rules to block Huawei from receiving shipments of cutting-edge chipsets, this became a major goal for the country.
    In 2020, the U.S. Commerce Department put in place a rule that blocks foundries that use American technology to build advanced chips from shipping such chips to Huawei even if the chips were designed by the company itself.
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  • Over 90 pct of Samsung, Intel workers return to work after Tet

    Over 90 pct of Samsung, Intel workers return to work after Tet

    Major factories in Ho Chi Minh City reported over 90 percent of employees returning to work after the nine-day Tet holiday, abating employer concerns of a labor shortage.

    Some factories with high return rates are Samsung electronics manufacturer HCMC CE Complex (95 percent) and motor parts maker Nidec Sankyo (94 percent). Other manufacturers like Intel and Jabil also reported a return rate of over 90 percent.

    Eight factories in Saigon Hi-tech Park of Thu Duc City, which utilize over 45,000 employees, reported between 80 percent and 95 percent of workers returning to work Tuesday after the annual Lunar New Year’s holiday Tet, according to park data.

    Over 17 industrial zones and manufacturing areas where 273,000 employees work posted a return of 82 percent.

    The high return rate is considered a relief to HCMC employers who, before the holiday, had expected a shortage of workers after Tet as many preferred to stay in their hometown.

    Tet, Vietnam’s biggest national holiday, is a time when workers of large industrial parks leave en masse for their hometowns for family renuions.

    Some factories of Vinatex, one of the biggest garment companies in Vietnam, posted a worker return rate of 100 percent as the company started off the year three days before the holiday ended to meet the surge in order numbers.

    Pou Yuen, footwear maker and biggest employer in HCMC, is expected to see its return ratio rising from 64 percent Monday to 90 percent Wednesday.

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  • Intel to meet this month with TSMC to avoid a fight with Apple

    Intel to meet this month with TSMC to avoid a fight with Apple

    It appears as though TSMC is back on track and is aiming to start mass production of chips using the 3nm process node starting in the second half of 2022. As a result, there is still a good chance that the Apple A16 Bionic chipset will be built with the 3nm process although earlier talk centered on the use of the 4nm process for the component. The difference is the number of transistors inside each chip which drives performance and energy efficiency.

    Intel plans on paying a visit to TSMC soon, and not just to personally give them holiday greetings. Intel is one of the foundry’s largest customers (along with Apple, AMD, NVIDIA, MediaTek, and Qualcomm) and they want assurance that TSMC will have enough capacity to make 3nm chips in the quantity that Intel needs.

    Intel is not a fabless company like Apple is, for example. That means that while Apple designs its own chips, it does not own equipment and fabrication facilities to manufacture them. While Intel does own its own foundry, it cannot produce cutting-edge chips as TSMC can. In January there was a report that TSMC was prepared to offer Intel capacity at 4nm while testing at 5nm.

    High-level Intel executives plan to travel to Taiwan in the middle of this month to meet with TSMC. On the agenda is the amount of 3nm capacity that Intel needs. While the American chip giant might have to outsource some of its production through TSMC, it also has indicated a desire to upgrade its own production capabilities.

    The meeting is being held so that Intel can “avoid fighting with Apple.” Reportedly, Apple has already worked out a deal with TSMC for all of the latter’s initial 3nm production capacity. This means that Intel most likely would not have access to TSMC’s 3nm capacity until 2023 at the earliest.

    Assuming that there is some urgency on Intel’s part (their executives aren’t flying to Taiwan for a vacation), it will be interesting to see whether Intel’s meeting with TSMC is productive. TSMC is the world’s largest independent foundry and last year it generated revenue of $45.51 billion which produced net profits of $17.60 billion. The company is valued at $565 billion.

    Now that Apple has created its own high-powered chips for the Mac that replace Intel processors, the company relies on TSMC even more. The Apple M1 chip contains 16 billion transistors which are one billion more than the number found in the A15 Bionic. The latter is used on the iPhone 13 series.

    Earlier this year, Apple introduced the M1 Pro, a 5nm chip that features 33.7 billion transistors, and the 5nm M1 Max with 57 billion transistors. Both are manufactured by TSMC.

    Apple is also rumored to be replacing Qualcomm’s 5G modem chip with one it will design itself.

    The new 5G modem chip will be built by TSMC using its 4nm process node, and it should debut in the 2023 iPhone 15 series. While Apple undoubtedly feels as though it now has no worries about obtaining enough chips in the future, it might have not considered how all roads lead to TSMC. And late yesterday we passed along a report from Fox News that noted how some experts fear that China might look to take back Taiwan to create a unified China.

    In such a scenario, the Chinese Communist Party (CCP) could create some serious global chaos by taking control of TSMC. China itself has realized that it needs to boost the chip production on the mainland. While the U.S. has also come to this conclusion about itself, it is trying to increase American production by having TSMC build a foundry in Arizona that could eventually grow to be a huge fabrication facility.

  • Apple fans have their minds blown by Intel in new video

    Apple fans have their minds blown by Intel in new video

    When Apple decided to use its own “Apple Silicon” on Macs replacing Intel processors, Intel was not happy. Today, Intel got back at Apple by posting a series of videos showing how Apple fans can be tricked into thinking that innovations created by Intel were discovered by Apple. In the first video called Breaking the Spell, a moderator named Kevin meets with Apple fans (“I’m an Apple girl in an Apple World,” says one) for some one-on-one discussions.

    Kevin has these Apple fans watch a video that they believe is about to show off a new Apple product. The video shows a chip called CPU Pro and on the screen, the video says, “Systems you can customize,” “Laptops you can upgrade,” and “Now you’re in control.” The Apple fans watching the video shake their heads up and down. This is what they have all been wanting.

    The moderator captures the attention of the Apple fans by asking them whether they would be interested in a device that plays over 57,000 different games effortlessly. He then shows an animation of a laptop with two 4K touchscreens. And if the laptop could fold into a tablet, that would be even better, the Apple fans said. “I would like to have my iPad and my laptop combined,” said one.

    Kevin goes out of the room and brings back a two-in-one laptop/tablet. “That kind of eliminates the need of an iPad,” one Apple fan says. The moderator then asks, “What if I told you that everything we’ve been talking about today is available now?” But Kevin then reveals, “But this was not Apple. That is a PC powered by Intel.”

    When the group hears that it was Intel, not Apple, that was behind the device that had just seen, they are stunned. Some laughed, others said, “Really” in disbelief. Several were ready to whip out their credit cards right away. The tag line: “When you break Apple’s spell the choice becomes clear.”

    Intel released the video on Monday and titled it a social experiment. You might recall that Apple was about to use a new 5G modem chip developed by Intel until it reached a settlement wiping out litigation between Apple and Qualcomm. As a result, Apple is able to stuff Qualcomm’s 5G modem chip inside both the iPhone 12 and iPhone 13 series. Eventually, though, Apple plans on designing its own 5G modem chips.

    In July 2019, Apple purchased most of Intel’s smartphone modem chip business for a cool billion dollars. And this past summer, roughly two years after it bought Intel’s smartphone modem chip operations, prescient TF International analyst Ming-Chi Kuo said that by as early as 2023, Apple might be ready to use its own 5G modem chip for the handsets that would make up the iPhone 15 line.

    Losing this business would be a terrible blow to the pocketbook for Qualcomm since the latter cannot make up for the loss of this business by designing Apple’s AP chips. Apple does that itself while having the chipset built by TSMC. Kuo said that Qualcomm might be forced to enter new markets in order to compensate for losing Apple’s 5G modem chip business for the iPhone.

    Even if Apple does start including a 5G modem chip that it designed itself with the iPhone 15, some older models that could still be in production would continue to use Qualcomm’s 5G modem chips. If for some reason you are unaware, Apple started offering 5G connectivity on the iPhone with the 2020 iPhone 12 series.

    This year, Apple started replacing Intel processors on Macs with the M1. This is a powerful chip designed by Apple and is built by TSMC using the 5nm process node. It contains a whopping 16 billion transistors.

  • Intel to build chips for Qualcomm; hopes to rival TSMC

    Intel to build chips for Qualcomm; hopes to rival TSMC

    TSMC and Samsung, the two top contract foundries in the world, will soon have a new rival. Reuters reports that yesterday Intel announced that it will start producing chips for other companies such as Qualcomm and Amazon. Intel expects to challenge TSMC and Samsung by 2025.

    Intel was once the T-Rex of chipmakers, but Taiwan’s TSMC has become the global leader with Samsung right beside it. Both of those firms produce chips for Apple, Qualcomm, AMD, and other top tech companies. The pair also currently manufacture chips using 5nm process nodes and have roadmaps down to 2nm. As an example of what each of the two foundries can offer,  TSMC is the foundry rolling out Apple’s M1 chip that carries a whopping 16 billion transistors (no typo here folks) in each chip.

    Intel says that over the next four years, it will introduce five new technologies related to the production of these vital components. One of the five is the introduction of Intel’s first new transistor design in ten years. As early as 2025, Intel will get its hands on ASML’s next-generation extreme ultraviolet lithography (EVL) machines that place on the silicon an image of where the circuitry will be placed.

    The EVL machine is important because it needs to produce extremely thin lines as transistor size shrinks allowing foundries to pack more transistors inside the components they manufacture. Intel also plans on revamping the way it names its chips to be more in line with TSMC and Samsung. Dan Hutcheson, chief executive of VLSIresearch, an independent semiconductor forecasting firm, said that Intel’s current naming protocol gave the impression that the company was less competitive.

    The larger the number of transistors that fit inside a square mm, the more powerful and less energy-guzzling a chip is. And while Intel has been losing the process node war with TSMC and Samsung, it does plan to reveal a design for transistors smaller than 1nm by 2024.

    Intel’s first major new customers will be Qualcomm and Amazon. The former is known for the Snapdragon chips that drive mobile phones with some helping to connect handsets to 5G networks. These chips will use Intel’s 20A manufacturing technique that will produce chips that consume less power than current components thanks to the use of new transistor technologies.

    Amazon plans on using Intel’s packaging technology for the components it produces itself for the data center chips used for its Amazon Web Services. Intel Chief Executive Pat Gelsinger stated that “There have been many, many hours of deep and technical engagement with these first two customers, and many others.”

    While some analysts remain cautious about whether Intel can deliver on the promises it has made, Real World Technologies’ David Kanter said that the chipmaker is being more cautious than it has been in the past. He says, “Intel is absolutely going to catch up, and be ahead in some dimensions, with TSMC over the next few years. Intel really does have people who spend all their time looking at how to deploy new materials and technology to juice their performance.”

    You might recall that a legal feud between Apple and Qualcomm had Apple scrambling for a 5G modem chip to replace the one it wanted from Qualcomm. Apple planned on using a new 5G modem chip designed and produced by Intel. But Apple wasn’t thrilled about this and eventually reached a settlement that allowed it and Qualcomm to bury the hatchet resulting in the use of Qualcomm’s 5G modems on the iPhone 12 line, the first iPhone models to support 5G.

    Eventually, Apple plans on designing its own 5G modem chip and ended up purchasing most of Intel’s smartphone modem business in July 2019 for $1 billion.

  • Intel CEO says chip shortage will continue throughout this year

    Intel CEO says chip shortage will continue throughout this year

    As many of you know, we are in the middle of a chip shortage that has been impacting automobile and consumer electronic manufacturers. Intel CEO Pat Gelsinger sees the shortage continuing throughout the remainder of this year, bottoming out during the second half of 2021 before things start to improve. In fact, the executive doesn’t expect the supply-demand picture to return to normal until 2023.

    Gelsinger said, “I don’t expect the chip industry is back to a healthy supply-demand situation until ’23. For a variety of industries, I think it’s still getting worse before it gets better.” Last month, we told you that the lead time, the time it takes between placing an order for semiconductors and actually receiving them, hit 17 weeks in April; that was the longest lead time recorded by Susquehanna Financial since 2017 and was a big jump compared to the previous year’s 12.53 figure.

    Unlike fabless manufacturers like Apple, Qualcomm, MediaTek, and others, Intel owns its own factories (aka fabs, short for fabrication plants). A company like Apple designs its own chips, but without the means to manufacture them itself, the company turns to the world’s largest contract foundry, Taiwan Semiconductor Manufacturing Company, Limited (TSMC Ltd.) to produce them.

    Gelsinger says that thanks to Intel’s ownership of its fabs, it is more able to keep up with demand for chips than those who are outsourcing production to another foundry. The executive says that demand for chips will continue to be strong over the next 10 years thanks to expected growth in demand for 5G smartphones, AI, and electric vehicles. Intel’s CEO is on the side of those industry executives who see the current demand for chips continuing into the future.

    Other executives don’t believe that the industry can sustain the growth of more than 5% on an annual basis. Broadcom Inc. CEO Hock Tan is one such executive. Even though his firm reported a 15% revenue hike for its latest quarter, Tan says chip production is a mature industry that will revert back to low growth.

    There is no denying though, how important chips are to the global economy. The U.S. leads the way in the sales and design of chips although production is led by Taiwan’s TSMC and South Korea’s Samsung. TSMC will be opening at least one fab in Arizona no later than 2024.

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  • Intel Reiterates Chip Supply Shortages Could Last Several Years

    Intel Reiterates Chip Supply Shortages Could Last Several Years

    Intel Corp’s CEO said on Monday it could take several years for a global shortage of semiconductors to be resolved, a problem that has shuttered some auto production lines and is also being felt in other areas, including consumer electronics. Pat Gelsinger told a virtual session of the Computex trade show in Taipei that the work-and-study-from-home trend during the COVID-19 pandemic had led to a “cycle of explosive growth in semiconductors” that has placed huge strain on global supply chains.

    “But while the industry has taken steps to address near-term constraints it could still take a couple of years for the ecosystem to address shortages of foundry capacity, substrates and components.”

    Gelsinger had told The Washington Post in an interview in mid-April the shortage was going to take “a couple of years” to abate, and that it planned to start producing chips within six to nine months to address shortages at U.S. car plants.

    Intel announced a $20 billion plan in March to expand its advanced chip manufacturing capacity, building two factories in Arizona and opening its plants to outside customers.

    “We plan to expand to other locations in the U.S. and Europe, ensuring a sustainable and secure semiconductor supply chain for the world,” Gelsinger said, without elaborating.

    Intel’s plans could directly challenge the two other companies in the world that can make the most advanced chips – Taiwan Semiconductor Manufacturing Co Ltd (TSMC) and South Korea’s Samsung Electronics Co Ltd.

    The two have come to dominate the semiconductor manufacturing business, moving its centre of gravity from the United States, where much of the technology was once invented, to Asia, where more than two-thirds of advanced chips are now manufactured.

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