Some customers walk away from 18A

[Y.H]

Reuters quoted CFO as saying sone customers fall out of 18A test chips. Any guesses who these customers are ?

https://www.reuters.com/business/intel-has-limited-customer-commitments-latest-chip-manufacturing-tech-cfo-says-2025-05-13/#:~:text=%22We%20get%20test%20chips%2C%20and,some%20of%20its%20Altera%20stake.

 

[siliconbruh999]

I wonder if the quality of PDK has anything to do with this.

 

[Erik F]

How can LBT look at Naga or whoever is in charge and not fire him on the spot?

 

[Kazkek]

Dave Zinsner, Vice President and Chief Financial Officer, Intel: Yeah. Well, the first eighteen a customer is going to be Intel products. Yeah. It’s Panther Lake, and the first SKU is expected to be out by the end of the year. So, is our first win, so to speak, if you put on the Intel foundry hat with 18A.

And really, we always expected that the predominant amount of volume of 18A was going to be internal to us. And we would win customers here or there And we don’t need a lot to fill in the gaps to make 18A a good node from an NPV perspective. So I feel actually pretty good about our ability to drive a reasonable return on 18A. 14 a, you know, obviously, gets more expensive.

At present, it’s expected to have high NA, and, you know, that’s a more expensive tool. So, you know, I think we do need to see more external volume come from 14a versus versus 18a. You know, so far, you know and we’ve we’ve talked about it in the past. We have, like, you know, the traditional, like, pipeline modeling, you know, a bunch of bunch of potential customers, and then we get test chips, and then some customers fall out in the test chips, and then there’s a certain amount of customers that kind of hang in there. So, committed volume is not significant right now, for sure.

But, you know, I think we’ve got to partly prove ourselves a little bit with our own product and eat our own dog food here, and then I think it’s more likely to come that we, you know, we start to see some engagement around customers. But the conversations have been good. I I would tell you that every customer surprisingly, one point under COVID everybody was worried about the supply chain. And then everybody kind of forgot about COVID and the supply chain concerns dissipated I would say. I’d say it’s now back to the more and more I hear customers wanting to have a second source, it doesn’t mean that the competitors or the largest competitor won’t get every bit of share that they want, but I think there’s always a requirement for a second source in these cases, and that’s the opportunity and that’s the area we want to fill.

We also have, I think, really good packaging, and we tend not to talk about that as we think about foundry, but we’ll have revenue in the back half of the year on packaging, advanced packaging, and I think that’s a great opportunity for us. The technology is differentiated already, it’s mature in a way that we still have work to do on the wafer side, and it’s a good vehicle to get customers in the door working with Intel Foundry in an area they have a lot of trust with us, and then kind of work them into Foundry deals over time. I’d say the other thing is, you know, challenge of being a foundry player in construct is that the products business competes against many of the customers that could be potentially customers of foundry. And so, what we have to do is make sure they feel confident that IP is getting protected, but maybe more importantly that supply is protected, that we’re not going to disadvantage them relative to products in terms of supply. I think Lip Bu in that regard is a real asset.



He’s trusted, he does the right thing, if he commits to a customer he delivers on that commitment and customers trust that, that he will do that. That I think has changed the dynamic of the conversations we’ve had with potential foundry customers, but just literally based on him walking in the door and making them feel at ease about those concerns.

https://www.investing.com/news/transcripts/intel-at-jpmorgan-conference-strategic-focus-under-new-leadership-93CH-4042544

 

[lefty]

Is that normal, for customers to back out after running a few test chips? I mean do they do that at TSMC?