[News] Intel Reportedly Outsources All Sub-3nm Process Production to TSMC 

Intel has outsourced the production of its Lunar Lake processors to TSMC. According to a report from Commercial Times, due to recent setbacks in Intel’s wafer foundry business, the company has decided to outsource all sub-3nm process manufacturing to TSMC.

The company is also said to be implementing a global 15% workforce reduction plan in an effort to reverse its decline. However, industry sources also reveal that the layoffs are primarily targeting the foundry business, while Intel’s Taiwan branch remains unaffected to maintain production partnerships with local chip manufacturers.

Intel remains committed to its wafer foundry business, as it reportedly released the 18A process design kit (PDK) to IC manufacturers in July.

However, recent reports indicate that Broadcom has expressed concerns about the feasibility of Intel’s 18A process, concluding that it is not suitable for mass production. A Broadcom spokesperson cited by the report has indicated that it is currently evaluating Intel Foundry Services’ products and services, though no final assessment has been reached yet.

Industry sources cited by Commercial Times further note that Broadcom has been collaborating with TSMC for many years, particularly in advanced processes below 7nm, positioning itself as a key player and securing a spot among TSMC’s top ten customers.

Looking at Intel’s latest quarterly report, its foundry business posted a loss of USD 2.8 billion, with an operating profit margin of -65.5%. The company acknowledged that the ongoing expansion of its Intel 4 and Intel 3 facilities in Ireland, along with increased R&D and startup costs for advancing its technology development, will impact profitability.

This has thus underscored the significant challenges Intel faced in achieving both technological breakthroughs and mass production in the semiconductor industry.

Intel is cutting costs and driving efficiency while actively pursuing transformation. The company aims to save USD 10 billion by 2025, even halted dividend payments—a move not seen in 30 years.

Additionally, its global expansion efforts have slowed. As per a recent report from Malaysian media outlet The Star, citing informed sources, it’s reported that Intel will temporarily halt its new chip packaging and testing project in Penang as part of cost-cutting efforts.

Read more

• [News] Amidst Rumors of Germany Plant Delay, Intel’s Penang Project Also Reportedly on Hold
• [News] Intel’s 18A Reportedly Runs into Trouble with Broadcom, while 20A Plan on Arrow Lake Cancelled

(Photo credit: Intel)