Intel signs Microsoft as Foundry customer; It says the firm is on track to overtake biggest rival TSMC.

Intel said on Wednesday Microsoft plans to use its services to make custom computing chips and that the company expects to beat its biggest rival, Taiwan Semiconductor Manufacturing Co., in advanced chip manufacturing by beating its 2025 internal deadline. I will leave behind.

The American chipmaker also gave new details about how it plans to maintain its lead. TSMC In 2026 and beyond.

Intel made the revelations at an event in San Jose, California, at the first technology conference for Intel Foundry, which it set up to compete with TSMC.

Intel says it plans to regain responsibility for making the world’s fastest chips from TSMC later this year with what it calls Intel 18A manufacturing technology and build on that lead with a new technology called Intel 14A. To be extended till 2026.

It said Microsoft will use its 18A technology to make the undisclosed chip and now expects $15 billion in foundry orders, up from the $10 billion the company previously told investors to expect. is more

TSMC said it had “no comment on the competitiveness of our advanced technologies” beyond what its CEO CCV said at the company’s last investor conference in January.

TSMC’s Taipei-listed stock has risen nearly 17% so far this year, driven by its dominance in the manufacture of advanced chips used in AI applications by companies such as Nvidia.

14A Technology’s news is the first time a Silicon Valley company has detailed its plans beyond 2025. That’s the deadline Intel’s CEO, Pete Gelsinger, set when he took the reins three years ago to reclaim the chipmaking crown.

For decades, Intel made chips only for itself and used its manufacturing lead to create a cycle in which it built chips with industry-leading performance and charged a premium for them. These margins, in turn, helped fund manufacturing advances. But when Intel lost its manufacturing lead, its chips became less competitive and margins slipped, eliminating the source funding for a manufacturing rebound.

Now, Intel is likely counting on billions of dollars in U.S. government subsidies and business from outside customers to help it get back on track.

It’s hoping some customers will be swayed by its long history of operating state-of-the-art factories on multiple continents, particularly those concerned about TSMC’s practice of keeping its state-of-the-art factories clustered in Taiwan. are

“It’s a sales pitch that’s resonating right now. People want it,” Steve Penn, the executive who oversees Intel Foundry, said of the company’s geographic diversification.

Intel says it has four “major” customers signed up for its 18A manufacturing technology but has yet to name them. It is unclear whether Microsoft is among those financially significant customers.

Intel said Wednesday it is partnering with Arm Holdings to make it easier for its factories to make chips with Arm technologies. Intel also said it will work with the University of California, Berkeley and the University of Michigan to give students access to its 18A manufacturing technology.

Intel also has a special technology that analysts say will be useful for speeding up power-hungry artificial intelligence chips. Nvidia, the leader in the AI ​​chip market, has said it is evaluating Intel’s manufacturing technology, but the two companies have not announced a deal.

Intel’s effort to attract outside customers is “key to the turnaround story,” said Ben Bajarin, chief executive of consulting firm Creative Strategies.

“Unfortunately, that’s an unanswered question, because it’s a two- to three-year journey before we know it’s working.”

© Thomson Reuters 2024

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