Nvidia and Broadcom test chips on Intel's 18A process

The US chip providers Nvidia and Broadcom are conducting production tests with Intel. This was first reported on Monday by the news agency Reuters, citing two anonymous sources familiar with the matter. The move is an expression of confidence in Intel's advanced production techniques, according to the sources. The US semiconductor company has been in a serious crisis for some time.

According to the news agency, the tests, which were first reported by Reuters, indicate that Nvidia and Broadcom are getting closer to a decision on whether to award Intel manufacturing contracts worth hundreds of millions of US dollars. Such a decision could give a boost to the ailing group's contract manufacturing business, also known as foundry.

According to Reuters, the tests by Nvidia and Broadcom are underway and could last for months. It is unclear when the tests began. The tests, which aim to test certain components of a chip before a complete design is produced in large quantities, use Intel's 18A process. This comprises technologies and techniques that can be used to produce advanced processors for artificial intelligence (AI) and other complex chips. The 18A process competes with a similar technology from the Taiwanese world market leader TSMC. However, the production tests are no guarantee that Intel will ultimately receive new orders, according to Reuters.

Presumably numerous interested parties

US chip manufacturer Advanced Micro Devices (AMD) is also examining whether Intel's 18A production process is suitable for its needs. However, it is unclear whether the company has had test chips manufactured. “We don't comment on specific customers, but we continue to see strong interest and commitment to Intel 18A across our ecosystem,” an Intel spokesperson told Reuters.

According to Intel, it has already signed contracts with Microsoft and Amazon.com to produce chips on 18A, but has not yet disclosed any details. In August last year, Broadcom had its first chips manufactured with 18A, but was not satisfied with the result. Shortly afterward, Intel announced that its designs, namely the “Panther Lake” and “Clearwater Forest” architectures planned for 2025, could already be produced with 18A in a functional state. There have also recently been reports that Broadcom is still interested in taking over Intel's chip development.

There has also been repeated speculation about a possible participation of TSMC in Intel's manufacturing division. Earlier this year, US government officials met with TSMC's CEO in New York to discuss a TSMC majority stake in a joint venture in Intel's fab unit, according to Reuters, citing a source familiar with the matter. The talks also discussed the possibility of other chip designers acquiring stakes in the new company.

Delays in Intel's contract manufacturing

Intel has been in troubled waters for years, not least because the company has fallen behind TSMC in state-of-the-art manufacturing processes. The company continues to be in the red. To cut costs quickly, the struggling semiconductor company is resorting to drastic job cuts. Around 15,000 jobs – around 15 percent of the workforce – are to be cut. Intel retired its CEO Pat Gelsinger at the beginning of December 2024. He had invested billions to establish Intel Foundry as a competitor to TSMC. The transitional co-heads of Intel have mothballed the planned AI chip.

Now the 18A process for potential contract manufacturing customers, which has already been postponed to 2026 following the Broadcom disappointment, could face further delays. The delay in Intel's ability to deliver chips for some contract manufacturing customers is due to the need to qualify key intellectual property for the 18A process. This is taking longer than expected. According to supplier documents seen by Reuters and two sources familiar with the matter, Intel has therefore pushed back the schedule by a further six months.

Intel expects its factories to receive designs from customers before the end of the year. Asked about the delay, a company spokesperson told Reuters: “We will ramp up production in the second half of this year, meeting the commitments we have made to our customers.”

(akn)