Tuesday, November 5th 2019
Intel CFO Talks About 7nm Rollout, Delay in 10nm, Increased Competition from AMD
Intel CFO George Davis in an interview with Barron's commented on the company's financial health, and some of the reasons behind its rather conservative gross margin guidance looking forward to at least 2023. Intel's current product stack is moving on to the company's 10 nm silicon fabrication process in a phased manner. The company is allocating 10 nm to mobile processors and enterprise processors, while brazening it out with 14 nm on the client-desktop and HEDT platforms until they can build 10 nm desktop parts. AMD has deployed its high-IPC "Zen 2" microarchitecture on TSMC's 7 nm DUV process, with plans to go EUV in the coming months.
"We're still keenly focused on gross margin. Everything from capital efficiency to the way we're designing our products. What we've said though, the delay in 10 nanometer means that we're going to be a little bit disadvantaged on unit cost for a period of time. We actually gave guidance for gross margin out in 2021 to help people understand. 2023 is the period that we were ultimately guiding [when] we're going to see very strong revenue growth and margin expansion. We've got to get through this period where we have the 10 nanometer being a little bit late [as] we're not optimized on a node that we're on. But [by] then we're moving to a two to two and a half year cadence on the next nodes. So we're pulling in the spending on 7 nanometer, which will start up in the second half of 2021 because we think it's the right thing to do competitively," he said.
Davis and Barron's also spoke about Intel's 7 nm rollout plans. Davis stated that Intel's 7 nm silicon fabrication node is expected to begin mass-production of chips only by the second half of 2021. Barron's then turned the discussion to AMD and the traction its EPYC "Rome" server processors are gaining with enterprises. "We said we expect to have heightened competition over the next 18 to 24 months. And our outlook reflects that. Our view on the nature of that competition and impact hasn't really changed since we gave [our] longer term forecast in May," he said. You can read the full Barron's interview from the source link.
Source:
Barron's
"We're still keenly focused on gross margin. Everything from capital efficiency to the way we're designing our products. What we've said though, the delay in 10 nanometer means that we're going to be a little bit disadvantaged on unit cost for a period of time. We actually gave guidance for gross margin out in 2021 to help people understand. 2023 is the period that we were ultimately guiding [when] we're going to see very strong revenue growth and margin expansion. We've got to get through this period where we have the 10 nanometer being a little bit late [as] we're not optimized on a node that we're on. But [by] then we're moving to a two to two and a half year cadence on the next nodes. So we're pulling in the spending on 7 nanometer, which will start up in the second half of 2021 because we think it's the right thing to do competitively," he said.
50 Comments on Intel CFO Talks About 7nm Rollout, Delay in 10nm, Increased Competition from AMD
This should be the one: www.barrons.com/articles/intel-cfo-stock-51572840766
Sorry Intel, I won't miss you.
And then may consider intel for the next build somewhere in 2025...
That'll be such a long wait since 2015 when SkyLake was first released.
I'm planning to buy a new Graphics Card next year as well so it will all go together :D
I figure I can sell ryzen 3600 for 90 easily enough when 4800x launches, and then finally retire for awhile. I didn't want to go balls out just yet, as I feel 4800x might be another 10% IPC gain. I hope so anyway.
Firstly, Intel have only ever NOT delivered on 10nm, on the vast majority of other nodes their time tables have been mostly reliable and their nodes have always had the edge over the competition. Therefore, don't assume 7nm will be late, slow, have issues and not ramp up incredibly quickly. Yes Intel probably should have binned 10nm 2 or 3 years ago and focused solely on 7nm but they were too proud for their own good, they grossly underestimated the threat of AMD and they always believed the solution to 10nm is just around the corner on the next respin/retool, but it never was and still isn't, not truly.
Secondly, at any point Intel can buy capacity on TSMC, Samsung or GF and become the leader again. Let's say another year or so passes, 10nm is vaguely up and running but if you want the fastest Intel CPUs it's still better to make them on 14nm++++, this isn't sustainable. With the lessons learnt from 10nm Intel are much more realistic about the times scans and potential issues of 7nm and if they can't see it working properly until 2023 or beyond then what do Intel do? They can't be still using 14nm when TSMC is using a very mature 3nm that would be ridiculous, so Intel would be forced to make the decision to move Golden Cove to TSMC's 5nm in 2021 and maybe move its GPUs so Samsung's facilities. It will be a massive pride swollowing experience for Intel but it will keep them alive and competitive until they get their own facilities back on track. It would be the smartest thing to do and shareholders would probably demand it. So I'm not saying this will happen, I believe 7nm from Intel will come faster and ramp more quickly than anyone really expects but I'm saying if there are issues with 7nm too then Intel still has the same option as AMD, NVIDIA, Apple, etc to just use a 3rd party provider. 'If you can't beat them, join them!'
The fact that they screwed with fabrication tech, that is an entirely different thing, but don't you ever go into thinking Intel is staying idle on their designs.
Just as a clarification, I do love what AMD achieved with latest gen of products, I love their pricing and hope they push the boundary even further. But I also tend to see things in a realistic manner.
So in a nut shell, Intel didn't need to lose it's crown just because of the 10nm issues, it was the poor decision making after realising 10nm had issues that really did the damage.
20 years ago there were dozens of IC manufactures that had leading nodes or close to them. Now you can count them on the fingers of one hand, you think anyone cared that all of these guys had reliable nodes up to the point when they couldn't compete ?The moment Intel resorts to other manufacturers it's over. There is a reason they are avoiding this like the plague and prefer to do nothing with regards to the shortages that they face and it's not due to their pride. The reason it's simple, so much of their cash and future product development is invested in their foundries it would probably sink them if they decide it isn't worth it any more, it's the same issue that nearly killed AMD many years ago. TSMC is the only viable manufacturer for leading nodes and there is no way they can sustain Intel's volumes, Intel is in really deep shit despite their efforts to appear calm.
Intel has a lot of fabs and judged by manufacturing capacity they should not have shortages that we see. However, with what Intel is saying about their plans (and not commenting on whether these will materialize as expected) they are moving their fabs over to 10nm and considering the timeline in plans are probably starting to move fabs to 7nm or are already in process of moving. That would explain 14nm shortages.
"Intel CFO George Davis in an interview with Barron's commented on the company's financial health, and some of the reasons behind its rather conservative gross margin guidance looking forward to at least 2023 " : sht happens
With every passing quarter and year, 10nm is getting more irrelevant and does not justify additional cost of widespread adoption in Intel fabs.
Call me crazy but you make it sound like Intel can just decide we will make iceLake 10nm and they do it. It took time for Intel to get the design of the CPU to work with the node. Believe me, if Intel could release the Sky Lake earlier, that would have happened earlier.How can you say it is more dense when it hasn't been released yet? Where do you get that information? How is it denser than 5nm TSMC when desktop 5nm from TSMC is not released yet as well.
What a crap you say. 7nm is like 3nm what is this stuff? 7nm is 7nm 5nm is 5nm what are you talking about?
The key now for Intel is it brings cutting edge architectures to whatever node they have, even if that is 14nm or bite the bullet and move production of some of their chips to another fab just so they don't lose too much market share.
Fact: The last time Intel had to worry about AMD (Or anyone else for that matter) 2017
That is 12 years of complete dominance in marketing, sales and hardware. The other thing it can and has done is stagnate. I look at where Intel is today the same way I looked at Tahiti when it was finalized by ATI/AMD. That series of GPU was so popular and nice for the consumer that I am sure there are still a ton of people with 7950, 290,280,390 cards but what it did was stagnated the GPU division of AMD (by then) because they could not come up with anything better without a heavy investment of time, money and brain power (which became Polaris and eventually Navi). Intel is huge and I mean huge they have more foundries around the world than most of us are aware of. The problem with being that big is it will take Intel longer to respond to AMD's (well TSMC's) 7nm and so on as not only will they have to make changes to their current 14+++ but also try to refine the albatross that is 10nm. Unfortunately, based on the timeline provided by Mr Davis they may be too late to take the wind out of AMD's sails fully as we have been getting more concrete announcements from them. Every news article from Intel lately has been about promise and nothing more. They are simply not nimble enough to respond to AMD in even a year's time. I have zero doubts though that when Intel does release 10NM nad 7nm desktop parts they should absolutely fly but who knows where AMD will be then too.
Sucks for us consumers but for Intel it does make sense to brave some of the storm out on 14nm.