A new report says that Apple A-series chipmaker TSMC is already making chips for Intel, following earlier speculation that this was in the cards.

TSMC has a dramatic technological lead over Intel when it comes to chip fabrication, demonstrated in the 5nm A14 chips the company makes for Apple …

Background

Speculation began last year that Intel might focus more on chip designs, outsourcing the fabrication of them.

Intel, which manufactures its own chips, has struggled. It’s only now moving in earnest from an earlier manufacturing technology with 14-nanometer features to a newer 10nm process after years of delays. Even next year’s Rocket Lake chip for desktop computers will still be built with the 14nm process […]

Intel is giving itself new options, including the ability to use other manufacturers like TSMC to build its chips.

A recent Bloomberg report said that Intel had held talks with TSMC.

As Intel plays catch up in the chip production industry, a new report from Bloomberg today indicates that Intel has talked with TSMC and Samsung about outsourcing some production.

TSMC ‘already making chips for Intel’

Bloomberg’s report said that Intel had yet to make a decision, but TrendForce says that orders have already been placed for non-CPU chips, and plans have been made for future CPUs.

Intel has outsourced the production of about 15-20% of its non-CPU chips, with most of the wafer starts for these products assigned to TSMC and UMC, according to TrendForce’s latest investigations. While the company is planning to kick off mass production of Core i3 CPUs at TSMC’s 5nm node in 2H21, Intel’s mid-range and high-end CPUs are projected to enter mass production using TSMC’s 3nm node in 2H22.

The report notes that AMD is also outsourcing to TSMC.

With regards to CPUs, AMD, which is also outsourcing its CPU production to TSMC, is progressively threatening Intel’s PC CPU market share.

TrendForce believes that Intel will manufacture its own high-margin chips, and outsource the production of the rest.

TrendForce believes that increased outsourcing of its product lines will allow Intel to not only continue its existence as a major IDM, but also maintain in-house production lines for chips with high margins, while more effectively spending CAPEX on advanced R&D.

Losing Apple’s Mac business has been a major blow to Intel. A billion-dollar investor in the chipmaker seems to imagine that the company could win back Apple’s business, a prospect which is clearly a non-starter now that Apple has demonstrated just how far ahead it is in terms of both processor performance and power efficiency. Intel’s latest 12-generation chips, expected to make it into laptops in the second half of the year, will still be made using a 10nm process.

Photo: Laura Ockel on Unsplash

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