Pat Gelsinger — Core Ultra is Hot

[Marees]

Intel has a wafer-level assembly problem, and it's hurting Core Ultra sales
Customers are hot for Intel's Core Ultra products

THE BIG PICTURE: Customers are clamoring for Intel's Core Ultra CPUs, but the chipmaker is facing a bottleneck in wafer-level assembly at the back end. It's a significant problem – dire enough that Intel is projecting flat revenues for the second quarter, partly due to this constraint. Intel is moving swiftly to expand capabilities in this area, but demand shows every sign of continuing to outpace supply, at least in the near term.

https://www.techspot.com/news/102768-intel-has-wafer-level-assembly-problem-hurting-core.html

"Seasonal client revenue is constrained by wafer level assembly supply, which is impacting our ability to meet demand for our Core Ultra-based AI PCs," Gelsinger said during the earnings call.

Intel has been addressing this issue by expanding semiconductor capacity in the US, Europe, and Asia. Gelsinger mentioned in a media briefing in Taipei late last year that the company is deploying wafer-level assembly and chip packaging manufacturing capabilities in Malaysia. Additionally, in the US, Intel is constructing new fabs in Oregon, Arizona, New Mexico, and Ohio. It has also unveiled major investment plans in Ireland, Poland, and Germany to build leading-edge semiconductor factories.

However, like its competitors, Intel is finding that demand is overwhelming supply. Gelsinger explained that Intel has been meeting its existing customer commitments, but many are returning and requesting additional shipments across different markets.


The company is "racing to catch up to those upside requests," he said, attributing the constraint to the back-end wafer-level assembly, which is one of the new capabilities included in Meteor Lake and subsequent client products. "So with that we're working to catch up and build more wafer level assembly capacity to meet those."

Gelsinger acknowledged that demand will only intensify with Microsoft's expected update to Windows 11. "Add in a second-half Windows upgrade cycle, which we believe is underway, and Core Ultra is hot," Gelsinger said.

Pat Gelsinger's initials are etched into Intel's processors

View attachment 650404

"Intel has faced its old failures since Gelsinger took the helm in 2021, and is actively trying to catch up to TSMC through a process that Intel calls “four nodes in five years.”

It hasn’t been easy. Gelsinger referred to its goal to regain leadership as a “death march” in 2022.

Now, the march is starting to reach its destination, and Intel said on Thursday that it’s still on track to catch up by 2026. At that point, TSMC will be shipping 2nm chips. Intel said it will begin producing its “18A” process, equivalent to 2nm, by 2025.

It hasn’t been cheap, either. Intel reported a $2.5 billion operating loss in its foundry division on $4.4 billion in mostly internal sales. The sums represent the vast investments Intel is making in facilities and tools to make more advanced chips.

“Setup costs are high and that’s why there’s so much cash burn,” said Bassi, the Counterpoint analyst. “Running a foundry is a capital-intensive business. That’s why most of the competitors are fabless, they are more than happy to outsource it to TSMC.”

Intel last month reported a $7 billion operating loss in its foundry in 2023.

“We have a lot of these investments to catch up flowing through the P&L,” Gelsinger told CNBC’s Jon Fortt on Thursday. “But basically, what we expect in ’24 is the trough.”

Not many companies have officially signed up to use Intel’s fabs. Microsoft has said it will use them to manufacture its server chips. Intel says it’s already booked $15 billion in contracts with external companies for the service.

Intel will help its own business and enable better performance in its products if it regains the lead in making the smallest transistors. If that happens, Intel will be back, as Gelsinger is fond of saying.

On Thursday, Gelsinger said demand was high for this year’s forthcoming server chips using Intel 3, or its 3nm process, and that it could win customers who had defected to competitors.

“We’re rebuilding customer trust,” the CEO said on Thursday. “They’re looking at us now saying ‘Oh, Intel is back.’”"

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Source: https://www.cnbc.com/2024/04/26/int...industry-now-struggling-to-stay-relevant.html

 

[Lakados]

Everyone seems to be constrained in the packaging stage right now TSMC included, the backlog on their stacking tech was also in the news not too long ago. The hardware needed to package things costs almost as much as the advanced lithography hardware and until recently the added costs didn’t pan out performance-wise. That changed over the past 2 years but between ASML delivery times and building construction timetables, you're looking at a 3+ year multi-billion dollar gap between identifying you have a problem and being able to resolve it.

 

[xDiVolatilX]

Interesting article thanks for posting.

 

[DukenukemX]

As bad as Meteor Lake was received by the tech press, it's apparently selling very well. It may not be as fast as their older chips, but it's very power efficient. It may not be as power efficient as Apple, but it's good enough for like 99% of people. Along with good GPU performance and AV1 encoding, nobody should be shocked that these chips sell. Again, it's x86 and not ARM or RISC-V which means these chips can run any software out there.

 

[Lakados]

As bad as Meteor Lake was received by the tech press, it's apparently selling very well. It may not be as fast as their older chips, but it's very power efficient. It may not be as power efficient as Apple, but it's good enough for like 99% of people. Along with good GPU performance and AV1 encoding, nobody should be shocked that these chips sell. Again, it's x86 and not ARM or RISC-V which means these chips can run any software out there.

They just have to do better than an M1 which is pretty much the laptop benchmark standard, and it does well enough there that they are usable.
The machines it got placed into aren't terrible either.
But price-wise, it falls close to the Apple stuff which isn't great.

 

[DukenukemX]

They just have to do better than an M1 which is pretty much the laptop benchmark standard, and it does well enough there that they are usable.
The machines it got placed into aren't terrible either.
But price-wise, it falls close to the Apple stuff which isn't great.

The reason these sell well is because Intel is sorta the gold standard for a lot of enterprises. AMD still has the advantage so far with better battery performance and better prices. Here's an AMD Zenbook 14 vs Intel's Zenbook 14, but the Core Ultra does have a better screen. The Intel with the same screen costs the same. If you look at the battery life, they're all nearly equal to an M3 Macbook 13" Air. AMD doesn't have any significant advantage over Intel anymore.


View: https://youtu.be/oIVSJX8dy2I?si=cAqVcDzUGasgmv7f

 

[Lakados]

The reason these sell well is because Intel is sorta the gold standard for a lot of enterprises. AMD still has the advantage so far with better battery performance and better prices. Here's an AMD Zenbook 14 vs Intel's Zenbook 14, but the Core Ultra does have a better screen. The Intel with the same screen costs the same. If you look at the battery life, they're all nearly equal to an M3 Macbook 13" Air. AMD doesn't have any significant advantage over Intel anymore.


View: https://youtu.be/oIVSJX8dy2I?si=cAqVcDzUGasgmv7f

I wish AMD took business machines seriously, but they don't. If AMD managed to get partnered up with Dell for something like the Latitude lineup that would be incredible.
But machines like the Zenbook just die in the office, they fall apart after 2 years from just the normal pickup and put down of people moving things around from meeting to meeting office to home and back again, it makes me sad :'(.

 

[KazeoHin]

I wish AMD took business machines seriously, but they don't. If AMD managed to get partnered up with Dell for something like the Latitude lineup that would be incredible.
But machines like the Zenbook just die in the office, they fall apart after 2 years from just the normal pickup and put down of people moving things around from meeting to meeting office to home and back again, it makes me sad :'(.

I buy quite a few AMD-based HP probooks and elitebooks for my org, and getting the AMD ones is preferred because you can get a 6/12 Ryzen 5,16GB or RAM with a touchscreen and LTE for the same price as an Intel i5 based machine without touchscreen or LTE, though they're never in stock OR only lower end models are available.

Also of note, on the Intel-based HP Probook 440 G10 devices there's a blatant Intel Core i5 sticker on the palm-rest. On the AMD ones (HP 440 G10) there's NO sticker. Intel just puts a LOT of money in forcing their brand into the view of the end-users. My guess is that Intel pays and additional $1 or $2 per unit to have that Intel sticker there.

 

[SoRnMaN]

The reason these sell well is because Intel is sorta the gold standard for a lot of enterprises. AMD still has the advantage so far with better battery performance and better prices. Here's an AMD Zenbook 14 vs Intel's Zenbook 14, but the Core Ultra does have a better screen. The Intel with the same screen costs the same. If you look at the battery life, they're all nearly equal to an M3 Macbook 13" Air. AMD doesn't have any significant advantage over Intel anymore.


View: https://youtu.be/oIVSJX8dy2I?si=cAqVcDzUGasgmv7f

Not sure why you picked those 2 to try to make AMD look better. The Intel has double the ram, double the ssd, and a better screen. Of course it is going to be more expensive. An AMD with similar specs is usually cheaper, you don't have to choose 2 with completely different specs to try to make that point.

 

[dogDAbone]

Capitalism 101 at it's finest......

Create the ideal "Supply & Demand" situation (tight supply AND high demand), then use that to justify massive price increases for very little performance improvements....

Sound familiar ?

Just like those so-called "floods, fires, electrical outages" etc....

Here we go AGAIN

 

[Wade88]

I wish AMD took business machines seriously, but they don't. If AMD managed to get partnered up with Dell for something like the Latitude lineup that would be incredible.
But machines like the Zenbook just die in the office, they fall apart after 2 years from just the normal pickup and put down of people moving things around from meeting to meeting office to home and back again, it makes me sad :'(.

This is why I emplace laptops and they're just somewhat more mobile desktops in our use. They move in nice cases too. I do keep a ~$1500 laptop though for the portable stuff though.