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Guru3D.com » News » Intel 14nm Processor shortages continue until mid-2019 (+ Open letter Update)

Intel 14nm Processor shortages continue until mid-2019 (+ Open letter Update)

by Hilbert Hagedoorn on: 09/28/2018 03:59 PM | source: digitimes | 31 comment(s)
Intel 14nm Processor shortages continue until mid-2019 (+ Open letter Update)

We've addressed this topic a number of times already, with the problems at 10nm, Intel is running out of fabrication space on 14nm, and they have a lot of processors and chipsets on that node. The fabrication shortage at 14nm means fewer processors fabricated, resulting in processors shortages on a global scale. And that drives up prices. 

A few days ago we already reported that the current Coffee lake (Core 8000 series) is currently suffering from increased prices, some procs even have risen 40 to 60% in price, overall for the higher end product it's 15 to 25% of an increase. The news on this keeps piling up as Compal (the company who fabs laptops for Acer, Apple, Dell, HP and Lenovo) has mentioned that these shortages are likely to last way into mid-2019, and that is a mighty long time.

Intel now has moved back chipset fabrication of for example the H310C chipset back to 22nm, just to free up space at 14nm. Intel also outsourced some production towards TSMC. The problems now also have moved into he data-centers, as 14nm Xeons and respective chipsets are facing shortages as well. Basically the shortages are not solely the effect of issues on the 10nm node, worldwide higher demand for chips is the main cause, and in fact maybe even a luxury problem for Intel. Intel also has extended desktop processors in 14nm, for example, the pending Core 9000 series will also be based on the very same 14nm fabrication node. Intel is simply sitting at this 14nm process longer than it expected as well, btw 10nm production has been postponed until the end of 2019.

Weirdly enough this all is still good news for Intel, as they can sell as much as they can deliver. It's just on the consumer and business side that due to these shortages, prices go up.

Update September 29th: 

The Intel CEO has posted an open letter on their website on this very topic.

An Open Letter from Bob Swan, Intel CFO, and Interim CEO

To our customers and partners,

The first half of this year showed remarkable growth for our industry. I want to take a moment to recap where we’ve been, offer our sincere thanks and acknowledge the work underway to support you with performance-leading Intel products to help you innovate.

First, the situation … The continued explosion of data and the need to process, store, analyze and share it is driving industry innovation and incredible demand for computing performance in the cloud, the network and the enterprise. In fact, our data-centric businesses grew 25 percent through June, and cloud revenue grew a whopping 43 percent in the first six months. The performance of our PC-centric business has been even more surprising. Together as an industry, our products are convincing buyers it’s time to upgrade to a new PC. For example, second-quarter PC shipments grew globally for the first time in six years, according to Gartner. We now expect modest growth in the PC total addressable market (TAM) this year for the first time since 2011, driven by strong demand for gaming as well as commercial systems – a segment where you and your customers trust and count on Intel.

We are thrilled that in an increasingly competitive market, you keep choosing Intel. Thank you.

Now for the challenge… The surprising return to PC TAM growth has put pressure on our factory network. We’re prioritizing the production of Intel® Xeon® and Intel® Core™ processors so that collectively we can serve the high-performance segments of the market. That said, supply is undoubtedly tight, particularly at the entry-level of the PC market. We continue to believe we will have at least the supply to meet the full-year revenue outlook we announced in July, which was $4.5 billion higher than our January expectations.

To address this challenge, we’re taking the following actions:

  • We are investing a record $15 billion in capital expenditures in 2018, up approximately $1 billion from the beginning of the year. We’re putting that $1 billion into our 14nm manufacturing sites in Oregon, Arizona, Ireland, and Israel. This capital along with other efficiencies is increasing our supply to respond to your increased demand.
  • We’re making progress with 10nm. Yields are improving and we continue to expect volume production in 2019.
  • We are taking a customer-first approach. We’re working with your teams to align demand with available supply. You can expect us to stay close, listen, partner and keep you informed.

The actions we are taking have put us on a path of continuous improvement. At the end of the day, we want to help you make great products and deliver strong business results. Many of you have been longtime Intel customers and partners, and you have seen us at our best when we are solving problems.

Sincerely,

Bob Swan
Intel Corporation CFO and Interim CEO

 







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sverek



Posts: 6070
Joined: 2011-01-02

#5590029 Posted on: 09/28/2018 04:04 PM
Intel got envy of Nvidia and AMD's GPU shortages caused by BitMining, so they created their own shortage! Genius!

Guess it's a new trend to create shortages and sell for more.

ThEcLiT
Senior Member



Posts: 519
Joined: 2006-12-08

#5590033 Posted on: 09/28/2018 04:11 PM
What is happening to PC Gaming? I really don't like this...

tunejunky
Senior Member



Posts: 3271
Joined: 2017-08-18

#5590034 Posted on: 09/28/2018 04:12 PM
hey Hilbert, not quite the windfall for Intel as you hinted. most of the oem sales are case and tray prices to start with (at lower prices), it's Compal et al who are marking up the price to compensate for the loss of bulk.

AMD is delighted because of the Xeon issues, just in time for Epyc and Ryzen Pro. Epyc was already forecasted to steal 5% in servers...looks to be much, much more considering lower power/ heat/ "moar" cores.

Jagman
Senior Member



Posts: 2258
Joined: 2005-03-26

#5590063 Posted on: 09/28/2018 05:03 PM
This will help AMD for sure and when Zen 2 / Ryzen 3 appears in 6 months or so, things will get even better for them.

P.S. To AMD, please send me a Zen 2 engineering sample for me to try out (with motherboard) :D

Endymion
Senior Member



Posts: 120
Joined: 2014-03-10

#5590075 Posted on: 09/28/2018 05:34 PM
Madness.

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