Although Intel invested some additional $1.5 billion to boost its 14 nm fab output last year, it looks like its supply problems are not going to be solved until the second half of this year. The company admitted on Thursday during its earnings conference call that supply challenges will persist throughout the third quarter.

“We have increased capacity to improve our position in the second half, although product mix will continue to be a challenge in the third quarter as our teams align available supply with customer demand,” said Robert Swan, CEO of Intel.

Because of record demand for server and high-performance client processors last year, Intel faced difficulties meeting demand for these products in 2018. As a result, the company had to invest $1.5 billion in manufacturing tools to increase output of its CPUs and chipsets made using its 14 nm process technologies in Oregon, Arizona, Ireland, and Israel.

Due to obvious financial reasons, Intel prioritized production of high-profile products like Xeon or Core i7/i9 over manufacturing of lower-end products, such as Atom, Celeron, or Pentium. This practice is expected to continue, so it will be somewhat easier to obtain a high-end part rather than an entry-level processor at least until the end of Q3.

A bit of good news, however, is that Intel started production of its Ice Lake-U CPUs in the first quarter. And, because of its factory network optimization, the company can produce more of such processors than it initially anticipated. Volume production of 10 nm CPUs will reduce pressure on 14 nm capacity and to a degree lower demand for 14 nm mobile products. As a result, the supply situation with Intel’s products made using 14 nm process technologies will likely be generally better in the second half of 2019.

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Source: Intel

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  • 0ldman79 - Tuesday, May 7, 2019 - link

    I don't know about that.

    Pretty sure Intel is still banking on 14nm for at least another year.

    Everything I've read says that the 10nm chips are going to be laptop, low performance only. Even the mobile performance line will 14nm. It's even sounding like the performance bump of Sunny Cove may be limited by lower clock speeds, so it's likely to only match the Skylake architecture in performance.

    There is supposed to be a U line on both 10nm and 14nm released this year. No desktop 10nm or even server on the horizon.

    Honestly it looks like they need to buckle down, make 14nm work absolutely as well as they can and get 7nm going, just skip 10nm entirely. Even their second, maybe third gen 10nm isn't performing. They're not going anywhere, but they're in a bit of a bind.

    They've made a few mistakes that are just going to take time to correct, that's going to hurt them for the next year or two. By then AMD will be on 7nm+ or maybe 5nm.
    Reply
  • baka_toroi - Friday, April 26, 2019 - link

    I used to play LoL with my 4th gen iGPU. Have requirements changed that much with that game?
    Besides, most people without a discrete GPU don't game.
    Reply
  • HStewart - Thursday, May 2, 2019 - link

    You do realize that people that don't game likely fill up 80% of all computers, also Gen 11 graphics replacement for integrated graphics is at speed of Nvidia 1030 or possible higher. Reply
  • ilt24 - Friday, April 26, 2019 - link

    @PaulHoule

    Because most systems don't require or have a dGPU, especially with laptops. Last I saw less than 40% of client PC's (desktop + Laptops) have a dGPU.
    Reply
  • PeachNCream - Friday, April 26, 2019 - link

    I've been gaming on iGPUs in laptops since the awful GMA 950 was made available. I put my HD 4400 to work in my current "gaming" laptop. They are slow. They do sometimes have driver problems and various limitations, but if you pick your games carefully, they can be as much of a time sink as the latest and most powerful dGPU at a fraction of the cost. And anyway, the majority of computers sold today ship with no dedicated graphics and are never upgraded either because its physically impossible or because that owner never considers it. Reply
  • Qasar - Saturday, April 27, 2019 - link

    PeachNCream
    the games i play.. integrated graphics... just wouldnt cut it.. but i also dont game on a laptop ( dont need to be portable, and i like playing with DTS/DD 5.1 surround sound :) ) hehehehehe but i guess that largely depends on what games one likes to play....
    Reply
  • ZoZo - Friday, April 26, 2019 - link

    "Due to obvious fiscal reasons"
    Did you mean financial reasons? Because if there are fiscal reasons, they're not obvious to me.
    Reply
  • Ryan Smith - Friday, April 26, 2019 - link

    And that would be the wrong F word...

    Yes, financial, not fiscal. Thanks!
    Reply
  • FreckledTrout - Friday, April 26, 2019 - link

    I really hope AMD is able to take maximum advantage of this shortage. We will all benefit if AMD can get a decent part of the market share. That will force Intel back to making the best product it can verus the stagnation they have been doing the last 4-5 years which has worked to maximize profits with little R&D. Reply
  • FreckledTrout - Friday, April 26, 2019 - link

    I should note I am also hopeful Intel takes a decent amount of GPU market share from Nvidia when they have a dGPU out in 2020. We need good competition in the CPU and GPU space as things have stagnated and/or are overpriced. Reply

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