July 26 (Reuters) – Intel Corp. (INTC.O) said Monday that its factories will begin building Qualcomm Inc. (QCOM.O) Chips and presented a roadmap for expanding its new foundry business to attract competitors such as Taiwan Semiconductor Manufacturing Co (2330.TW) and Samsung Electronics Co Ltd (005930.KS) by 2025.
Amazon.com Inc (AMZN.O) will be another new customer for the foundry chip business, said Intel, which has been the technology leader for decades in making the smallest and fastest computer chips.
But Intel has lost that lead to TSMC and Samsung, whose manufacturing services helped Intel’s rival Advanced Micro Devices Inc. (AMD.O) and Nvidia Corp. (NVDA.O) produce chips that surpass Intel’s. AMD and Nvidia design chips that are then manufactured by competing chip manufacturers, the so-called foundries.
Intel said Monday it expects to regain its lead by 2025, describing five sets of chip manufacturing technologies it will adopt over the next four years.
The most advanced are using Intel’s first new design in a decade for transistors, the tiny switches that convert to digital ones and zeros. From 2025, a new generation of machines will also be available from the Dutch ASML. opened up (ASML.AS) who use what is known as extreme ultraviolet lithography, which projects chip designs onto silicon, much like printing an old-fashioned photo.
“We are presenting a lot of details to The Street to hold us accountable,” said Intel CEO Pat Gelsinger in an interview with Reuters, referring to investors.
Intel also said it will change its chip manufacturing technology naming scheme to use names like “Intel 7” based on the way TSMC and Samsung market competing technologies.
In the chip world, where smaller is better, Intel used to use names that alluded to the size of the functions in “nanometers”. But over time, the names used by chipmakers became arbitrary, said Dan Hutcheson, CEO of VLSIresearch, an independent semiconductor forecasting firm. This gives the erroneous impression that Intel is less competitive.
Intel’s first major customers will be Qualcomm and Amazon. Qualcomm, which dominates chips for cell phones, will use what Intel calls its 20A chip manufacturing process, which uses new transistor technology to reduce the chip’s power consumption.
Amazon, which is increasingly making its own data center chips for its Amazon Web Services, is not yet using Intel’s chip manufacturing technology, but will use Intel’s packaging technology, the process of assembling chips and “chiplets” or “tiles” that are often stacked one inside the other so-called 3D education. Intel stands out in this packaging technology, analysts say.
“There were many, many hours of intense and technical engagement with these first two customers and many others,” said Gelsinger.
Intel did not disclose details of how much sales or production volume the customer wins would bring, although Gelsinger said at an event that the Qualcomm deal included a “large mobile platform” and was related in a “deep strategic way”. Qualcomm has a long track record of using multiple foundry partners, sometimes even for the same chip.
The biggest question Intel faces is whether the company can deliver on its technology promises after years of delays under former CEO Brian Krzanich. In the past few weeks, Intel announced the delay on a new data center chip called the Sapphire Rapids.
But David Kanter, an analyst at Real World Technologies, said Intel is more cautious than it has been in the past. The years of delays resulted in part from the “hubris” of addressing multiple technical problems in a single generation of technology.
This time around, Intel puts forward five generations of technology in four years, addresses minor issues and also says that it may not adopt the new EUV technology with the upcoming “Intel 18A” process if it is not ready.
“Intel will absolutely catch up in the next few years and be ahead in some dimensions with TSMC,” said the analyst Kanter. “Intel really has people who spend all of their time figuring out how to use new materials and technologies to improve their performance.”
Reporting by Stephen Nellis in San Francisco; Editing by David Gregorio
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