Intel Aims to Expand its Foundry Clientele Amid New Chip Processing Challenges

At a recent Bank of America tech conference, Michelle Johnston Holthaus, head of Intel’s product division, addressed questions about the company’s Intel Foundry Services. The focus was on adapting Intel’s 18A and 14A chip processes for external clients, a move that posed new challenges.

Adapting Processes for External Needs

Although Intel initially developed its 18A and 14A chip processes without external clients in mind, the company is now realigning its strategies. Holthaus acknowledged that adapting these processes for outside customers involves significant investments. This shift is driven by the need to cater to client-specific demands, like introducing process variations such as 18AP.

Investment and Client Acquisition

Despite the initial challenges, Intel remains optimistic about reaching profitability in its foundry business by 2027. The company is focused on client acquisition to justify continued investments. Holthaus emphasized, “We need to demonstrate our capability to attract clients to continue investing.”

Strategic Partnerships and Market Positioning

Intel is also investing $50 billion in new facilities, designed partly with future clients in mind. To enhance product competitiveness, Intel is leveraging both in-house manufacturing and partnerships with TSMC and Samsung. For example, Nova Lake processors will utilize this hybrid approach.

Long-term Vision

Looking forward, Intel aims for a balanced production ratio of 70% in-house and 30% external manufacturing, though no specific timeline is set. This strategy ensures flexibility and competitiveness, which are critical for Intel’s long-term success in the semiconductor market.