Intel Might Stop Manufacturing Chips

[LAwLz]

Summary

If Intel is unable to get customers for their Intel 14A process node (aka 1,4nm node) then they might give up on making chips completely. They would still keep making processors and such, but the actual manufacturing would probably be made by someone else like TSMC or Samsung.

 

 

 

 

Quotes

Quote

If we are unable to secure a significant external customer and meet important customer milestones for Intel 14A, we face the prospect that it will not be economical to develop and manufacture Intel 14A and successor leading-edge nodes on a go-forward basis.

[...]

In such event, we may pause or discontinue our pursuit of Intel 14A and successor nodes.

 

My thoughts

Very bad news for the industry as a whole. TSMC is essentially already a monopoly when it comes to leading edge nodes, and with Samsung being ~1 generation behind for the last decade or so I fear that the already high prices we see will get even worse.

 

 

 

Sources

https://www.businessinsider.com/intel-us-chipmaking-nears-death-up-cutting-edge-chips-14a-2025-7

[sounds]

It's worth pointing out the same letter sent to employees by Lip Bu Tan also announced cutting 15% of their workforce. And that he's personally going to review every new processor design.

 

When management decides share buybacks are more important than paying employees... you get this.

[Dedayog]

4 minutes ago, LAwLz said:

Summary

If Intel is unable to get customers for their Intel 14A process node (aka 1,4nm node) then they might give up on making chips completely. They would still keep making processors and such, but the actual manufacturing would probably be made by someone else like TSMC or Samsung.

 

 

 

 

Quotes

 

My thoughts

Very bad news for the industry as a whole. TSMC is essentially already a monopoly when it comes to leading edge nodes, and with Samsung being ~1 generation behind for the last decade or so I fear that the already high prices we see will get even worse.

 

 

 

Sources

https://www.businessinsider.com/intel-us-chipmaking-nears-death-up-cutting-edge-chips-14a-2025-7

No worries, the US is bringing manufacturing back home.  We'll have sub-1nm chips soon, cuz 'Murica.

[StDragon]

15 minutes ago, Dedayog said:

No worries, the US is bringing manufacturing back home.  We'll have sub-1nm chips soon, cuz 'Murica.

There's a difference between little and no domestic production. For suppliy chain redundancy (national security), this is important. It's not about pride.

[Dedayog]

7 minutes ago, StDragon said:

There's a difference between little and no domestic production. For suppliy chain redundancy (national security), this is important. It's not about pride.

I didn't think I needed the /sarcasm tag, but it seems I did

 

 

[05032-Mendicant-Bias]

Strategically, it's a death sentence for USA manufacturing to let Intel foundries be sold off to the highest bidder, given that Intel foundries are mostly in israel, TSMC is within artillery range of China and is a near monopoly, Samsung foundries are within artillery range of North Korea, and SMIC is in China and gaining purchase.

 

Then again, the USA seems uninterested in strategic moves and more interested in selling off the USA for parts lately, even irrationally putting a tariff on chips they can't manufacture locally.

 

Biden era USA and Europe did try to reverse this with blank cheque to get foundries back.

[Fasterthannothing]

Gosh dang I'm not in favor of using the government to prop companies up except for this instance where our security is at stake. The government should be pouring money into getting Intel up to speed on our own turf not letting them die off and sell themselves to another company in a foreign country.

[Timme]

The only thing they can compete on is price.... Hopefully.

[StDragon]

1 hour ago, 05032-Mendicant-Bias said:

Then again, the USA seems uninterested in strategic moves and more interested in selling off the USA for parts lately, even irrationally putting a tariff on chips they can't manufacture locally.

Just to be clear, the current administration absolutely is interested strategic moves to ensure combat readiness via an uninterupted supply to procure hardware (munitions and vehicles need ICs) ! It's the corporations that give zero Fs about divesting production from the US.

[OhYou_]

working in a cutting edge fab is incompatable with americans. Just look into the one they tried so hard to push in Arizona. 
read stories from the Taiwanese workers there about how it was going. 
intel fab is whatever, it will try to be sold to the highest bidder but USA will block the sale to literally anyone at this point and that is going to utterly destroy intel's sale price. 
there will never be a chip fab on US mainland run by us workers in sub10nm. 

[Sauron]

2 hours ago, LAwLz said:

on a go-forward basis

Corporate lingo is so funny, why can't they just say "in the future" like normal people..?

[starsmine]

God the way certain financial bros write about intel so constantly wrong is mind-numbing. 
I am not concerned that intel wont find a customer for 14A

but yes, if intel doesnt find a customer for 14A the company is bunk.... that's just the reality. we knew this when the company was bet on the 18A/18A-P family. Once the company was bet on these two nodes, this is the only possible outcome. Get customers, survive; don't get customers, die. That is literally what they meant when they said they were betting the company. 

[porina]

Source seems to be behind a paywall (or at least an account I'm not going to make) so can't see what they said, and I'm too tiered to dig up the actual Intel filing right now.

 

It is normal in financial reporting to cover themselves to prevent someone in future saying "you lied about _____" and suing them for it. They can't just paint the best case, but have to give other possible scenarios too.

[Fred Castellum]

The economics behind chip manufacturing itself is complex, competition would be good but even with competition more advance manufacturing techniques require more and more cost. 

Intel seriously is struggling unfortunately. 

[starsmine]

Some far more correct analysis then BI's click bait.

[atxcyclist]

13 hours ago, OhYou_ said:

there will never be a chip fab on US mainland run by us workers in sub10nm. 

That seems like a wildly unsubstantiated claim to make.

[LAwLz]

I think it is sad that they might abandon manufacturing, but I can kind of see why when you read stuff like this:

 

Quote

We have been unsuccessful to date in attracting significant customers to our external foundry business.

In other words, Intel doesn't have any significant customers for their foundry business.

 

The same document also specifies that their revenue (not profits) from external partners were a mere $53 million in Q2, which is flat compared to 2024 Q2.

During the same time Intel's total revenue was $9.1 billion. The external foundry business is 0.58% of Intel's revenue, and it is probably really expensive so who knows if they even make any money at all. 

[leadeater]

5 hours ago, LAwLz said:

The same document also specifies that their revenue (not profits) from external partners were a mere $53 million in Q2, which is flat compared to 2024 Q2.

During the same time Intel's total revenue was $9.1 billion. The external foundry business is 0.58% of Intel's revenue, and it is probably really expensive so who knows if they even make any money at all. 

I wouldn't expect Intel Foundry Service to be meaningful until around 5 years after it started and/or 3rd offered node. Most customers wouldn't put significant manufacturing in to something like that until they have done some very extensive product manufacturing testing and analyzed various other market products that have used it. I know Intel is actually very good even if not the best but it's a leading edge node and if you are pinning the success of such a product on the foundry which is inevitable with those products then have to be really sure it's the correct choice.

 

This is business reporting business speak, they have to give the direct current truth, numbers and projections. It doesn't really matter if the CEO or the COO of IFS thinks IFS will be high market competitive and very profitable in 5 years, that's still potentially misleading investors so a massive no no to push that narrative.

 

If Intel was talking this way outside of financial quarterly reports and investor earnings calls then it would be far more interesting and concerning, they are not doing that btw.

 

Quote

Tan addressed this need at Direct Connect by continuing to talk about Intel’s customer-centric approach and about listening to what customers want and need. This is also why Intel brought both Cadence and Synopsis onstage to talk about how they are working together to enable faster time-to-market with new silicon designs for Intel Foundry. Intel also brought out Amkor, QuickLogic, Siemens EDA and PDF Solutions to represent the ecosystem of partners enabling designs for Intel Foundry. Many of the partnerships included Intel’s 18A and 18A-P processes, but also its packaging technologies like EMIB.

https://www.forbes.com/sites/moorinsights/2025/06/05/intel-foundry-direct-connect-2025-expands-roadmap-and-partnerships/

 

Quote

This release contains forward-looking statements that involve a number of risks and uncertainties, including with respect to our business plans and strategy and anticipated benefits therefrom, our fabrication process technology roadmap, our advanced packaging roadmap, our manufacturing facilities, and our ecosystem alliances, tools and IP. Such statements involve many risks and uncertainties that could cause our actual results to differ materially from those expressed or implied, including those associated with: [...]

 

Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Readers are urged to carefully review and consider the various disclosures made in this release and in other documents we file from time to time with the SEC that disclose risks and uncertainties that may affect our business.

 

Unless specifically indicated otherwise, the forward-looking statements in this release do not reflect the potential impact of any divestitures, mergers, acquisitions, or other business combinations that have not been completed as of the date of this filing. In addition, the forward-looking statements in this release are based on management's expectations as of the date of this release, unless an earlier date is specified, including expectations based on third-party information and projections that management believes to be reputable. We do not undertake, and expressly disclaim any duty, to update such statements, whether as a result of new information, new developments, or otherwise, except to the extent that disclosure may be required by law.

https://www.intc.com/news-events/press-releases/detail/1739/intel-foundry-gathers-customers-and-partners-outlines

 

5 hours ago, LAwLz said:

The external foundry business is 0.58% of Intel's revenue, and it is probably really expensive so who knows if they even make any money at all. 

Intel is their own biggest customer and is not reported in that so any conclusionary assessments in to the profitability of IFS that doesn't factor in that would always be wrong.

 

Intel as a company was struggling before IFS, that is true. Intel also had a bunch of failed acquisitions, business ventures and technologies also so all of their struggles can't be pinned on fabs and CPU products. Intel still sells more CPUs than AMD for example.

[starsmine]

Quote

Otherwise, Intel Foundry’s technology roadmap remains unchanged, even with Tan’s larger restructuring efforts. 18A remains a critical node for Intel – marking the debut of their GAAFET and BSPDN technologies – albeit with the tacit acknowledgement that Intel hasn’t been able to attract much in the way of external customers for the node thus far. So while 18A (and 18A-P) will be critical nodes for Intel Products – and long-lived ones that will see heavy use well into the next decade – it remains to be seen if and when they’ll have significant adoption by other chip designers. If all goes well for Intel, they hope to be able to sign-up customers for 18A in successive waves after proving its competitiveness, which would have it in contention for n-1 designs that don’t need to be on bleeding-edge process nodes.

Beyond that lies Intel 14A, which is still far enough out for Tan to make some more significant changes to Intel’s roadmap. Tan’s letter to Intel’s employees makes it clear that he is tying the success of 14A far more closely to external customer adoption – meaning that for 14A to succeed, Intel needs to land the external customers that Intel hasn’t been able to attract to date. According to Tan, 14A will be developed “from the ground up in close partnership with large external customers.”

Along those lines, Tan also intends to take a more conservative path with building out 14A capacity. Rather than a “build it and they will come” mentality, Tan intends to only build out as much 14A capacity as Intel Foundry needs. Or as Tan put it:

Going forward, our investment in Intel 14A will be based on confirmed customer commitments. There are no more blank checks. Every investment must make economic sense. We will build what our customers need, when they need it, and earn their trust through consistent execution.

Painting with broad strokes, this leaves in question what will happen with 14A if Intel doesn’t attract sufficient outside use. Does Intel still build out any 14A capacity if Intel Products is the only major user? And can Intel Products alone drive enough usage to make 14A financially viable? We’re still years out from the launch of 14A, but Tan’s conservative approach to building out capacity means that a large capacity build-out for 14A is not guaranteed at this time.

https://morethanmoore.substack.com/p/intel-2025-q2-financials

And we know Amazon is one of the companies wanting to use 18A, they have not committed to 14A.

[Mark Kaine]

On 7/25/2025 at 5:18 PM, OhYou_ said:

working in a cutting edge fab is incompatable with americans. Just look into the one they tried so hard to push in Arizona. 
read stories from the Taiwanese workers there about how it was going. 
intel fab is whatever, it will try to be sold to the highest bidder but USA will block the sale to literally anyone at this point and that is going to utterly destroy intel's sale price. 
there will never be a chip fab on US mainland run by us workers in sub10nm. 

Maybe if they investigate in education, ban social media and stop voting basically already dead people, otherwise yeah no not gonna happen.  

[Why_Me]

On 7/25/2025 at 7:18 AM, OhYou_ said:

working in a cutting edge fab is incompatable with americans. Just look into the one they tried so hard to push in Arizona. 
read stories from the Taiwanese workers there about how it was going. 
intel fab is whatever, it will try to be sold to the highest bidder but USA will block the sale to literally anyone at this point and that is going to utterly destroy intel's sale price. 
there will never be a chip fab on US mainland run by us workers in sub10nm. 

Do tell.

https://pr.tsmc.com/english/news/3210   

 

 

[LAwLz]

18 hours ago, starsmine said:

https://morethanmoore.substack.com/p/intel-2025-q2-financials

And we know Amazon is one of the companies wanting to use 18A, they have not committed to 14A.

Amazon is probably a fairly small order, since Intel says they have "no significant customers".

 

 

 

On 7/27/2025 at 5:37 AM, leadeater said:

If Intel was talking this way outside of financial quarterly reports and investor earnings calls then it would be far more interesting and concerning, they are not doing that btw.

They have sent out an internal memo regarding the situation and they do not sound any more positive.

 

 

Quote

We will take a fundamentally different approach to building our foundry business. Over the past several years, the company invested too much, too soon – without adequate demand. In the process, our factory footprint became needlessly fragmented and underutilized. We must correct our course.

 

Going forward, we will follow a systematic approach to growing our factory footprint that’s fully aligned with the needs of our customers. We will be judicious and disciplined as we allocate capital – because that’s what great foundries do.

 

With that in mind, we have decided not to move forward with previously planned projects in Germany and Poland. We also plan to consolidate our assembly and test operations in Costa Rica to our larger sites in Vietnam and Malaysia. Costa Rica remains a large and important Intel site that’s home to key engineering teams and corporate functions.

 

We remain deeply committed to investing in the U.S., where we will apply the same level of financial discipline. To that end, we are further slowing construction in Ohio to ensure our spending is aligned with demand – while maintaining flexibility to accelerate based on new customer wins.

 

We are also sharpening the focus and financial discipline of our technology development investments. Job number one is ramping Intel 18A at scale. Intel 18A and Intel 18A-P are critical nodes for Intel Products and will drive meaningful wafer volumes well into the next decade – starting with Panther Lake later this year. As we ramp our own products in high volume and deliver for important Intel 18A customers like the U.S. government, we will be in a better position to attract external customers to this technology.

 

Looking further ahead, we’re developing Intel 14A as a foundry node from the ground up in close partnership with large external customers. This is essential to designing a process that meets specific customer requirements and enables us to address a broader segment of the market. Going forward, our investment in Intel 14A will be based on confirmed customer commitments. There are no more blank checks. Every investment must make economic sense. We will build what our customers need, when they need it, and earn their trust through consistent execution.

 

They are saying the same thing as the previous statement.

1) They will not develop 14A or future processes if they do not get significant customers first.

2) They think they have invested too much in their fabs and will scale it back. or example slowing down the development of new fabs in the US.

3) They are halting the development of their fabs in Germany and Poland, and are also going to shut down some fab-related things like the test operations in Costa Rica.

 

Right now, everything points towards Intel being in a really bad spot fab wise, in the eyes of their CEO.

Unless something big happens, chances are they will not develop anything past A18 (and thus not be in the leading-edge fab game), and even then that seems like it will mostly be used by Intel themselves. Not any big external customer.

[starsmine]

47 minutes ago, LAwLz said:

Amazon is probably a fairly small order, since Intel says they have "no significant customers".

because amazon is only doing test chips for now. Not a full tape out. If amazon does do a full tape out, they would be a significant customer as it will be making chips for AWS.

47 minutes ago, LAwLz said:

They have sent out an internal memo regarding the situation and they do not sound any more positive.

 

 

 

They are saying the same thing as the previous statement.

1) They will not develop 14A or future processes if they do not get significant customers first.

2) They think they have invested too much in their fabs and will scale it back. or example slowing down the development of new fabs in the US.

3) They are halting the development of their fabs in Germany and Poland, and are also going to shut down some fab-related things like the test operations in Costa Rica.

 

Right now, everything points towards Intel being in a really bad spot fab wise, in the eyes of their CEO.

Unless something big happens, chances are they will not develop anything past A18 (and thus not be in the leading-edge fab game), and even then that seems like it will mostly be used by Intel themselves. Not any big external customer.

they ARE developing and investing in 14A

what they will not do is build out more fabs if they do not have the customers.

So instead of half a dozen fabs at the leading edge, it will just be the one for intel products. which also means costs to develop do not get amortized, but it also means they cut their losses rather then going with a build it and they will come approach to capacity. 

 

Lip bu does NOT think they invested too much into their fabs. its the opposite, what he disagrees with is the timing and how it was done. As in Pat was too late to right the ship and there was a more conservative way to do it. 

 

point 3 is going back to they are not going to build fabs that do not have confirmed customers. 

[whispous]

I am still fairly certain that they know the government will find a way to transfer public money to them, for national security manufacturing reasons.

[leadeater]

2 hours ago, LAwLz said:

1) They will not develop 14A or future processes if they do not get significant customers first.

It does not say this at all. Any interpretation in to that realm is honestly just a massive reach. Again Intel is a customer of their own process nodes, they will be developing future nodes for themselves, as a customer, and have not said anything about abandoning future leading edge nodes to exclusively use external 3rd party nodes for those products. 

 

All they said was they won't aggressively push future node development without customer requirements. Intel/IFS before was trying to create the best technology node possible to attract customers. Intel/IFS in future will develop nodes based on actual customer requirements. That means they may not be creating the industry leading cutting edge node(s) but they will have something customers want, providing there are customers obviously (but again they have themselves).

 

All I read in to that is Intel wants to walk before they run, of which they were sprinting previously which was worse than running.

 

2 hours ago, LAwLz said:

2) They think they have invested too much in their fabs and will scale it back. or example slowing down the development of new fabs in the US.

Correct but that doesn't mean anything more than the literal statement that was made. The problem is the speculation being derived from that which from what I can see are nothing more than leaps of logic and "faith" (unfaith).

 

This isn't a I disagree that they are doing this I just simply disagree that it's a sign Intel is going to stop developing future nodes. That specifically is not a statement Intel has made, there is nothing in there that directly states this.

 

2 hours ago, LAwLz said:

3) They are halting the development of their fabs in Germany and Poland, and are also going to shut down some fab-related things like the test operations in Costa Rica.

Which can all be continued later when there is actual demand for it.

 

Intel being their only customer, if that happens, is not that bad. It's the literal entire history of Intel and isn't the exclusive woes of current Intel. The other simple truth is TSMC and Samsung do not have the manufacturing capacity to take on all leading edge Intel products.