Well, at Intel's Q4 earnings call, CEO Lip-Bu Tan and CFO David Zinsner made several remarks suggesting that the foundry division is progressing with steady momentum.
Intel Is Projecting "Billions in Revenue" From Chip & Advanced Packaging Commitments
While at the consumer/DCAI front, Team Blue showed sluggish progress in maintaining a balance between the two businesses, but when it comes to how Intel Foundry is evolving, CEO Lip-Bu Tan gave us an extensive rundown of how nodes are progressing and customer sampling. Talking about the 18A and derivatives, Lip-Bu Tan revealed that the company is now moving towards supplying PDK 1.0 for its 18A-P process to potential customers, as the foundry progresses aggressively with yield rates.
We are now shipping our first products built on Intel 18A, the most advanced semiconductor process developed and manufactured on U.S. soil. As stated earlier, yields continue to improve steadily as we work to ramp the supply needed to meet strong customer demand. In addition, Intel 18AP continued to progress well. and we are engaging with internal and external customers on this note, delivering our 1.0 PDK at the end of the last year.
- Intel's Lip-Bu Tan
When we talk about external adoption in the node portfolio, Intel's 18A-P is emerging as a viable solution, competing with TSMC's N3 process, which is under a severe supply bottleneck. Customers like Apple are known to be engaged with Intel during the sampling process, and while the company hasn't yet specified a commitment, indicators suggest the industry sees Intel Foundry as a viable partner. The central question with Intel right now is whether the company has enough CapEX for customer orders, and when CFO David Zinsner was asked about it, here's what he had to say:
Yes. On 14A, Lip-Bu has been very direct with us on all of this. He does not want to spend on capacity on 14A only spend on the kind of TD spend or R&D spend associated with 14A even in the fab until we have customers secured.
We've talked about, the likelihood is, our customers on 14A their window to secure or for us to secure them will be in the back half of this year and in the first half of next year. And so once visibility improves there, we'll start to unlock the spend on 14A.
- Intel's David Zinsner
Intel is facing a capital problem with its foundry division, as its R&D and fab development stages have accounted for a large share of total CapEX spending. The main doubt that the industry sees with Intel Foundry is that even if the 18A-P/14A node turns out to be viable enough, the company won't have enough capital on hand to ramp up production, but it appears that Team Blue is waiting for foundry commitments by customers before deciding to "unlock the spend" on next-gen processes.
In terms of 14A milestones, customers are currently at 0.5 PDK sampling, and based on the CFO's comments, any commitments would be delivered by H2 2026, which means the second half could be crucial for the foundry division. 14A is known to be an externally focused process, and we have discussed how mainstream fabless companies are looking to adopt the node, integrate High-NA, and adopt several leading-edge technologies.
Okay. Now this product. This is a volume we're going to run with you. and that's how you're starting to build. So -- in terms of 14A, realistically in terms of, I call it, the risk production in the later part of 2027 and real production, volume production in 2028. That is similar to the same time frame as a leading foundry.
- Intel's CEO Lip-Bu Tan
Intel's Advanced Packaging Is Turning Out to Be a Massive Prospect For Foundry Revenue
Intel's executives also discussed how the company is progressing with advanced packaging, given that it is a segment under severe constraints, with fewer foundries in the industry that could serve as viable replacements. Intel's EMIB and Foveros are among the solutions HPC customers see as promising, and we have discussed this earlier as well. The idea is that Intel is positioning its packaging portfolio to be competitive. And, according to CFO David Zinsner, customers are actually "prepaying for production" of EMIB and EMIB-T, indicating that external customer volume is undoubtedly there.
I think the EMIB-T, I think, is a very big differentiator for us. And then clearly, we have a couple of customers willing to even prepay the subscript -- because [ subscript ] is very big supply shortage and then they're willing to share with us. That means that show the commitment they are going to be working with us.
- Intel's CFO David Zinsner
Zinsner has also revealed that advanced packaging commitments are expected to scale up to the north of "$1 billion", which means that moving ahead in 2026, EMIB could be witnessed in mainstream products, and this could prove to be a significant factor when it comes to working towards reducing foundries' operating losses, and eventually achieve break-even. Customers who can get frontend and backend semiconductors in a single spot would undoubtedly go for that way, and Intel Foundry is one of the few entities that offer such a service.
The work being done to make Intel Foundry a successful US chip company is playing out as we progress, and now Team Blue is in a much better position to capitalize on external volume, thanks to its chip and advanced packaging technologies.
About the author: Muhammad Zuhair is a hardware and technology reporter for Wccftech, specializing in the semiconductor industry and the complex interplay between technology, manufacturing, and geopolitics. His coverage focuses on the corporate strategies and technological roadmaps of industry giants like TSMC, NVIDIA, Samsung, and Intel. Zuhair's expertise lies in deconstructing complex topics such as fabrication nodes (e.g., 2nm process), the economic impact of policies like the CHIPS Act, and the strategic development of AI infrastructure from NVIDIA, AMD and Intel.
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