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Intel announces 6 month delay of 7nm to 2023 — Shares fall 13%


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https://www.tomshardware.com/news/intel-announces-delay-to-7nm-processors-now-one-year-behind-expectations

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Intel announced today in its Q2 2020 earnings release that it has now delayed the rollout of its 7nm CPUs by six months relative to its previously-planned release date, undoubtedly resulting in wide-ranging delays to the company's roadmaps. Intel's press release also says that yields for its 7nm process are now twelve months behind the company's internal targets, meaning the company isn't currently on track to produce its 7nm process in an economically viable way. The company now says its 7nm CPUs will not debut on the market until late 2022 or early 2023.

 

https://seekingalpha.com/amp/news/3594717-seven-downgrades-far-for-intel-post-earnings-shares-slump-13

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Among the "clear winners" from Intel's (NASDAQ:INTC) 7nm delay are Advanced Micro Devices (NASDAQ:AMD), Broadcom (NASDAQ:AVGO), Marvell (NASDAQ:MRVL), Nvidia (NASDAQ:NVDA), and Xilinx (NASDAQ:XLNX), says Rosenblatt Securities. AMD, for one, is up 7.1% premarket. Intel is down 13%.

 

https://www.bloomberg.com/news/articles/2020-07-23/intel-process-delay-sparks-44-billion-swing-in-chipmaker-values

^Over $25 billion in market cap was erased, right after NVIDIA stole the crown for the largest market cap of any chipmaker. Both AMD and TSMC enjoyed some nice little gains as a result of Intel's earnings announcement.

 

One interesting takeaway is this snippet right here:

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On the earnings call, Intel CEO Bob Swan said the company had identified a "defect mode" in its 7nm process that caused yield degradation issues.

As a result, Intel has invested in "contingency plans," which Swan later defined as including using third-party foundries.

 

It's getting so bad that Intel is saying they're going to be increasing their reliance on third-party foundries. This was always the plan for their discrete GPUs, but it appears they're looking into expanding that for their core products. We'll have to wait and see what that means, exactly.

 

10nm for the desktop is still on track for the second half of next year, and while that may not sound very good with AMD already a year into 7nm, keep in mind Intel's 10nm is actually denser than TSMC's 7nm process. How companies rate their manufacturing processes is really up to them, so there's never any consistency between foundries. Of course, by 2021, AMD is expected to be using TSMC's 5nm process, which will certainly be a generation ahead of Intel's 10nm.

 

Chart of transistor densities if you're interested:

 

 


490px-5nm_densities.svg.png
 

 

 

Basically this is Intel once-and-for-all ceding manufacturing dominance from the rest of the world for the foreseeable future. This has been Intel's primary strength against their competitors; their in-house foundries were the best in the world for most of their existence. Without newer manufacturing processes, their architectural roadmaps suffer, despite Intel claiming to have 'decoupled' chip design from manufacturing node. The reality is more advanced architectures require more transistors, or at the very least, lower-power transistors.

 

Alder Lake is the core architecture expected next year on 10nm. Compared to AMD's Zen 4 on 5nm, it will likely use more power, but it's hard to say if core count will be as important a battleground as it has been the past three years. Beyond 16 cores (or even 12, frankly) you quickly start to run out of applications that can make significant use of available threads, so it will take time for software to catch up. The next-gen will likely be all about single-threaded performance again. Both Alder Lake and Zen 4 are expected to bring new sockets, chipsets, and support for DDR5.

 

Beyond that there's Intel's Meteor Lake. This is the one directly affected by the 7nm delay. Not much is known about Meteor Lake, other than the move to a 'heterogeneous' design, with multiple dies and a push for both low-power and high-power cores similar to ARM CPUs in many current smartphones. Unless Intel takes the drastic move to transition their CPUs to competitor foundries, we'll likely see AMD retain the enthusiast performance crown, possibly switching roles to becoming the "premium" chipmaker while Intel mops up the cheaper price points.

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