By Max A. Cherney and Stephen Nellis
SAN JOSE, California (Reuters) -Intel said on Tuesday that several of its contract manufacturing customers planned to build test chips for a forthcoming advanced manufacturing process, which the company still has in development.
The embattled chipmaker indicated it had received interest from customers at its Direct Connect conference on Tuesday for its contract chip business, or foundry. Intel (NASDAQ:INTC)’s attempt to build a foundry unit has hit snags, but ultimately the goal has been to rival TSMC.
Upon taking the CEO job in March, Lip-Bu Tan vowed to reshape Intel and in his first public remarks asked customers to be "brutally honest" when delivering feedback. As part of his plans to remake Intel, Tan plans to revamp the company’s foundry operation.
At the event on Tuesday in San Jose, California, Tan said that, since he took the top job five weeks ago, people in the industry have been asking him whether he plans to commit to the foundry business.
"The answer is ’yes’," Tan said. "I’m committed to (making) the Intel foundry successful, and I know there are areas we need to improve."
Intel had planned to introduce a new type of advanced chipmaking tool known as a high-NA EUV machine through the still-in-development manufacturing process known as 14A, which also includes a new technology for power delivery.
The use of the newest high-NA EUV machines could help Intel make chips with fewer steps, but it does entail some risks. Intel’s foundry tech chief, Naga Chandrasekaran, said Intel will still have the option of using older and more proven technologies and customers will not have to change their designs.
But the use of the high-NA EUV machines is a reversal from one of Intel’s major strategic mistakes during the 2010s, when it declined to use an earlier generation of EUV machines while TSMC pressed ahead with the technology. TSMC has not yet disclosed when it plans to adopt high-NA EUV machines for mass chip production.
Intel also said on Tuesday it had distributed an early version of the digital design kit that is necessary to ensure the company can successfully transform a chip blueprint into a working piece of silicon.
’UPS AND DOWNS’
Chandrasekaran said the company’s 18A process is "facing ups and downs" as with any new technology, but the "team has continued to make progress."
Chandrasekaran forecast Intel would be able to serve customers with high-volume production on the 18A process toward the second half of 2025.
Chip companies typically build test chips to evaluate a new manufacturing process ahead of committing to a complete design, which is far more expensive and risky. Broadcom (NASDAQ:AVGO) and Nvidia (NASDAQ:NVDA) have run tests for Intel’s 18A process, Reuters reported in March.
Intel plans to initially manufacture chips with 18A at its research and development lab near Hillsboro, Oregon. The company’s factories in Arizona will ramp up production this year, the company said.
Intel shares were slightly higher in mid-afternoon trading.