Question Intel Q2: 7 nm in bad shape

[jpiniero]

Investor Relations

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Here's the money shot:

The company's 7nm-based CPU product timing is shifting approximately six months relative to prior expectations.
The primary driver is the yield of Intel's 7nm process, which based on recent data, is now trending approximately
twelve months behind the company's internal target.

Data Center volume up 29% (plus 5% ASP)
Notebook up 9%
Desktop down 14% - not as bad as I had thought

Q3 guidance bad - revenue of 18.2b vs 19.2b in 2019

 

[Hitman928]

If they can actually get CPUs based on 7nm by late 2022/early 2023, it is probably going to be fine, but if they can't, this is probably the time they should be preparing plan B (using TSMC 5nm or Samsung 5/3nm). Not having competitive product out there is more devastating than worrying about wasting previous investment.

Yeah, that's the problem though, in order to be ready for a failed 7 nm rollout in 2023, you need to be planning now. From the whispers I've heard, Intel's ego is preventing them from making a plan B (meaning 3rd party fabs) right now. If 7 nm does face additional delays, trying to make a plan B even this time next year will be too late and push Intel that much further behind. From what I understand, Intel's plan B is essentially 10+++, which IMO, would be disastrous for Intel. This is just what I've heard through the grapevine so take with as much salt as you'd like.

 

[uzzi38]

If they can actually get CPUs based on 7nm by late 2022/early 2023, it is probably going to be fine, but if they can't, this is probably the time they should be preparing plan B (using TSMC 5nm or Samsung 5/3nm). Not having competitive product out there is more devastating than worrying about wasting previous investment.

Early 2023 isn't good enough for their 7nm. Late 2022 maybe, but certainly not early 2023.

 

[A///]

Coming from Intel itself, I certainly believe this. What I am sick of, is the Intel advocates that keep telling us "oh, its coming sooner than expected" and "its got a fine yield, doing great".

Positive thinking is one thing, but right out lying or greatly exaggerating is another.

While I don't want Intel to fail as a company (as I am sure they will not) I am ready for competition to get some market share for a long term battle that will continue. Its healthy and good for the consumer.

It's the 5 stages of denial. Seems many are stuck in stage 1 of the cycle. Intel is well diversified these days that they can stink to high heaven and still survive.

 

[JasonLD]

Some clarificatio: Intel are producing tiles both internally and externally, and will be packaging both together in-house.

Ah, ok. So they do have some flexibility of using external chips on their own packaging.

Yeah, that's the problem though, in order to be ready for a failed 7 nm rollout in 2023, you need to be planning now. From the whispers I've heard, Intel's ego is preventing them from making a plan B (meaning 3rd party fabs) right now. If 7 nm does face additional delays, trying to make a plan B even this time next year will be too late and push Intel that much further behind. From what I understand, Intel's plan B is essentially 10+++, which IMO, would be disastrous for Intel. This is just what I've heard through the grapevine so take with as much salt as you'd like.

At least Intel stopped tying their architecture to certain node so if they choose to use external fabs, I think they will be able to do it. Just have to suck up their egos and act fast.

Early 2023 isn't good enough for their 7nm. Late 2022 maybe, but certainly not early 2023.

Well, AMD is most likely be using 5nm for at least 2 generations so if they can actually hit early 2023, wouldn't be so devastating. Not ideal, but good enough to be at least competitive.

 

[uzzi38]

Well, AMD is most likely be using 5nm for at least 2 generations so if they can actually hit early 2023, wouldn't be so devastating. Not ideal, but good enough to be at least competitive.

That may not be the case.

Time will tell for certain.

 

[JasonLD]

That may not be the case.

Time will tell for certain.

Well, considering the timing of Zen 3 release, I think Zen 4 is definitely going to be early 2022 product. I think Zen 5 in 2023 is very likely another 5nm product. So early 2023 for Intel 7nm CPU isn't that devastating as it looks.

 

[uzzi38]

Well, considering the timing of Zen 3 release, I think Zen 4 is definitely going to be early 2022 product. I think Zen 5 in 2023 is very likely another 5nm product. So early 2023 for Intel 7nm CPU isn't that devastating as it looks.

Yeah Zen 4 is early 22 (Q1-Q2), Zen 5 is Q2-Q3 23. But still either way, not a good place to be in for Intel to debut 7nm.

 

[A///]

Man, that is going to be tough sledding for Intel. AMD and ARM will most likely be on TSMC's 3 nm by the time Intel gets 7 nm out the door in volume.

Or 5nm+. Intel may remedy the 7nm situation quickly compared to 10nm unless they've fudged it more than they've lead their shareholders on. Having said that, this recent news blip about 7nm being delayed shines some light on why Mr. Keller excused himself from Intel.

 

[JasonLD]

Yeah Zen 4 is early 22 (Q1-Q2), Zen 5 is Q2-Q3 23. But still either way, not a good place to be in for Intel to debut 7nm.

Yeah, definitely not ideal, but at least it will be very competitive. Now actually making late 2022/early 2023 is another thing. Intel should act now if they are not confident that they will hit either of those timelines on their 7nm CPUs.

 

[maddie]

Remember this article? 3 months, that's all it took.

https://seekingalpha.com/article/43...ng-company-losing-process-leadership-to-intel

 

[uzzi38]

Remember this article? 3 months, that's all it took.

https://seekingalpha.com/article/43...ng-company-losing-process-leadership-to-intel

Dude, 3 weeks ago a certain someone said they had an $INT price target of $210.

3 weeks ago.

 

[lyonwonder]

Given Intel's track record with manufacturing processes 10nm could become the new 14nm with several 10nm refreshes on the desktop side with 7nm for mobile.

 

[maddie]

Given Intel's track record with manufacturing processes 10nm could become the new 14nm with several 10nm refreshes on the desktop side with 7nm for mobile.

Is this even workable? When they were stuck on 14nm, they had a multi-year process lead. This has now reversed, so I don't see them staying relevant if the same thing happens with 10nm. It'll be a similar situation to when AMD owned fabs and were years behind.

 

[Jimzz]

I believe that I’ve read in multiple locations that TSMC is still very capacity constrained on their leading edge node products. For AMD to get more capacity, it will take a bidding war with Apple and Nvidia for it among others.

TSMC expanded their 7nm production and also they lost Huawei as a customer due to US embargo. Huawei made up around 20% of TSMCs revenue I believe. TSMC has said others have already taken Huawei's place on the fabs.

Taiwan minister says TSMC has offset lost Huawei orders

Taiwan Semiconductor Manufacturing Co (TSMC) <2330.TW> has made up its order book with other customers now that it has lost China's Huawei Technologies Co Ltd [HWT.UL], which is subject to U.S. sales restrictions, a government minister said on Monday.

www.reuters.com

I bet some of that fab space went to AMD as Huawei was using 7nm for some chips.

 

[JustMe21]

To me, I don't see Intel or AMD doing anything too impressive lately.

Intel needs to get their 10nm process matured so they can reduce their CPU power consumption. They need to get their architecture exploits redesigned so it's an actual architecture change and not a hardware patch. They need to get chiplets or stacked chips going. They need to get their new GPU out in their chips and discrete cards in volume. They also need to stop gimping their lower end chipsets.

AMD needs their processors and APUs to be on the new architecture at the same time, not 6+ months later and the APUs shouldn't be gimped. Their various chipsets need to be released close together. They need to get their RDNA2 architecture into their APUs faster and implement SmartShift on the Desktop APUs and make it CrossFireish (or Big/Little) with RDNA2 discrete cards. And let's not forget supply, as the 4600U is basically nowhere to be found and the 4800U processors are hard to find, except maybe in China. The RDNA2 GPU performance needs to either rival Nvidia's top GPUs or run more power efficiently (aka Turing/RDNA levels) while still being close in performance. I also think AMD needs a 75W GPU that doesn't require a power connector with performance rivaling the GTX 1650. And finally, the GPU driver issues need to be solid on RDNA2 release.

 

[uzzi38]

https://twitter.com/x/status/1286447154471383040

This two things just went live and... I'm not happy.

 

[jpiniero]

https://twitter.com/x/status/1286447154471383040

This two things just went live and... I'm not happy.

Client CPU first, eh? Pentiums? Atom maybe?

 

[trexfromouterspace]

idk I kind of feel like Steak is overrated. If you give me a choice between Steak and Sushi I'm taking Sushi every time.

 

[Hitman928]

https://twitter.com/x/status/1286447154471383040

This two things just went live and... I'm not happy.

Our data center GPU design, “Ponte Vecchio,” will now be released in late 2021 or early 2022

Just for those who may not want to or be able to open twitter when reading the thread.

 

[uzzi38]

Just for those who may not want to or be able to open twitter when reading the thread.

You forgot the other half:

"We now expect to see initial production shipments of our first Intel-based 7nm product, a client CPU in
late 2022 or early 2023... including the holiday refresh window of 2022"

First DC CPU on 7nm launched in "first half of 2023."

 

[turtile]

Well, considering the timing of Zen 3 release, I think Zen 4 is definitely going to be early 2022 product. I think Zen 5 in 2023 is very likely another 5nm product. So early 2023 for Intel 7nm CPU isn't that devastating as it looks.

But then AMD will have 3nm a year later and probably 2nm before intel gets to 5nm. Intel can't win if they are behind in process and AMD matches in IPC.

There's also a 4nm TSMC node which is improved N5.

 

[JasonLD]

But then AMD will have 3nm a year later and probably 2nm before intel gets to 5nm. Intel can't win if they are behind in process and AMD matches in IPC.

There's also a 4nm TSMC node which is improved N5.

3nm and 2nm is bit of uncertainty at this point. I think I saw the article on Digitimes saying 3nm is half node and 2nm is actual full node jump with GAA. I can't really say about who has the better IPC in 2023 until we see how Alder lake with Golden Cove compares against Zen 3/4.

 

[turtile]

3nm and 2nm is bit of uncertainty at this point. I think I saw the article on Digitimes saying 3nm is half node and 2nm is actual full node jump with GAA. I can't really say about who has the better IPC in 2023 until we see how Alder lake with Golden Cove compares against Zen 3/4.

TSMC's 3nm is supposed to be 1.7x the density of 5nm but not much of a performance gain. It's also scheduled to be released in 2022. Of course, AMD will have a different version but at two years later, I don't see why that would be surprising to still be released on time even if there is a delay.

 

[awesomedeluxe]

That may not be the case.

Time will tell for certain.

I'd be willing to bet Apple keeps 3nm tied up though. They will have their entire product line on TSMC and they have a lot more money than AMD. And they are in the exact same position as AMD in regards to marketshare. I know the conventional wisdom is that Apple never goes for marketshare, but they have every reason to try if it will keep team red a year behind them.

 

[Geranium]

AMD needs their processors and APUs to be on the new architecture at the same time, not 6+ months later and the APUs shouldn't be gimped. Their various chipsets need to be released close together. They need to get their RDNA2 architecture into their APUs faster and implement SmartShift on the Desktop APUs and make it CrossFireish (or Big/Little) with RDNA2 discrete cards. And let's not forget supply, as the 4600U is basically nowhere to be found and the 4800U processors are hard to find, except maybe in China. The RDNA2 GPU performance needs to either rival Nvidia's top GPUs or run more power efficiently (aka Turing/RDNA levels) while still being close in performance. I also think AMD needs a 75W GPU that doesn't require a power connector with performance rivaling the GTX 1650. And finally, the GPU driver issues need to be solid on RDNA2 release.

75W Card -> AMD tired that with RX 460/560 but it didn't work.
Besides if you need 75W card buy the GTX 1650. Need it to be cheaper, buy more GTX 1650.