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Introduction:
Intel’s newly appointed CEO, Lip-Bu Tan, is shaking up the strategic vision of the iconic U.S. semiconductor giant. Known for his sharp financial acumen and past success as CEO of Cadence Design Systems, Tan is already signaling a departure from his predecessor’s bold but risky plans. With Intel suffering its first annual loss since 1986—an eye-watering \$18.8 billion in 2024—Tan is reportedly preparing a major shift: pulling back from marketing Intel’s 18A chipmaking technology to external clients and doubling down on the next-generation 14A process.
If this internal pivot materializes, it could mark one of the most consequential moves in the company’s modern history—especially as it tries to claw its way back in a fiercely competitive chip landscape dominated by TSMC. This article breaks down what’s changing at Intel, what’s at stake, and why this decision could reshape the global foundry market.
Intel May Ditch 18A Foundry Strategy Amid Losses
According to a recent Reuters report, Intel’s new CEO Lip-Bu Tan is actively re-evaluating the company’s foundry ambitions. Specifically, sources close to the matter claim that Tan is considering pulling the plug on external sales of its advanced 18A and 18A-P manufacturing processes. These nodes were a central part of former CEO Pat Gelsinger’s vision to transform Intel into a major player in the global foundry business.
The 18A technology, which includes cutting-edge innovations in transistor structure and power delivery, was supposed to compete head-on with TSMC’s N3 process. However, with TSMC having moved on to the N2 node, Intel’s once-promising 18A appears to be falling behind in relevance and competitiveness. Although Intel still plans to use 18A internally—most notably in its upcoming Panther Lake chips set for late 2025—Tan reportedly sees diminishing interest from third-party clients. If Intel pulls the plug on external 18A sales, it could result in a write-off potentially worth billions of dollars.
Instead, Tan is prioritizing development of the 14A process, a more advanced node he believes could close the technological gap with TSMC and attract power players like Apple and Nvidia. While 18A will still be used to fulfill existing contracts—such as those with Amazon and Microsoft—its long-term role in Intel’s business appears uncertain.
Sources suggest Intel’s board may see a formal proposal by the end of July, although a final decision may not come until the fall. The company has affirmed its commitment to honoring current obligations and rebuilding client trust, all while aggressively reshaping its roadmap.
What Undercode Say:
Lip-Bu
Abandoning 18A for external clients is not a sign of defeat—it’s a calculated retreat. By focusing resources on the more promising 14A process, Intel is signaling that it wants to leapfrog, not chase, competitors. TSMC’s N2 is already entering the scene, meaning any delays to 18A adoption could render it obsolete from a competitive standpoint. Why market a technology your rivals have already surpassed?
The focus on 14A may be Intel’s best shot at reclaiming relevance in mobile computing and AI-centric workloads, where power efficiency and cutting-edge transistors are non-negotiable. Importantly, Tan’s shift to prioritize Apple and Nvidia—two clients deeply entrenched with TSMC—reveals his willingness to swing for the fences. Securing even a fraction of their chip production could change Intel’s fortunes almost overnight.
There’s also the financial logic. A multibillion-dollar write-off would sting, but continuing to burn money on a process losing client interest is a longer-term liability. The optics of that on Wall Street would be even worse. If Tan can redirect capital into building a compelling 14A story, investors may see the short-term pain as necessary medicine.
What remains unclear is
Tan’s leadership will ultimately be judged not on his willingness to make bold decisions—but on Intel’s ability to deliver where it matters: performance, pricing, and reliability. And that, right now, remains an open question.
🔍 Fact Checker Results:
✅ 18A compared to TSMC N3: Confirmed. Analysts agree Intel’s 18A is technically on par with TSMC’s N3 process, which began high-volume production in 2022.
✅ Intel’s \$18.8B net loss in 2024: Verified via SEC filings and public earnings reports.
❌ 14A timeline guarantees: No public timeline ensures 14A will be ready before TSMC’s N2 gains mass adoption; speculative at best.
📊 Prediction:
If Intel successfully shifts its foundry development toward 14A and executes with precision, it could re-enter the conversation as a viable competitor to TSMC by 2027. However, failure to deliver on 14A’s promises—especially given past delays—may leave Intel sidelined permanently in the high-performance foundry market. Investors should watch for early signs of 14A performance leaks and customer interest in the next two quarters.
References:
Reported By: timesofindia.indiatimes.com
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