Not all possible problems were clearly stated at Intel’s quarterly reporting event, and therefore some of the authors of related news materials were in for some surprises. Semiconductor industry expert Patrick Moorhead generally suggested that Intel has problems with the production of Meteor Lake processors, and this negatively affects production costs.
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Intel CFO David Zinsner noted at the reporting event that the company’s costs in the second quarter were negatively impacted by the need to increase production volumes of products for the AI PC segment. Of the officially presented processors in this area, Intel has the Meteor Lake family, although it is already forced to launch Lunar Lake, which will be presented in September. However, the latter will be almost entirely processed by TSMC, and the testing and packaging procedure will fall on Intel itself, so the company’s financial performance in the second quarter was largely influenced by Meteor Lake.
«We decided to accelerate the transfer of Intel 4 and Intel 3 technologies from the research laboratory in Oregon to the production line in Ireland, where the costs of processing silicon wafers in the near future will be higher,” Zinsner explained. Some experts explained this rush not so much by the need for more crystals for Meteor Lake, produced using Intel 4 technology, but by the conditions set to the manufacturer by investors from Apollo Global Management. It should be recalled that Intel is equipping its Fab 34 enterprise as part of an investment agreement with Apollo, under which the former has already received $11 billion in the second quarter in exchange for 49% of the shares of the created joint venture. Intel retains the right to purchase 100% of the enterprise’s products, but undertakes to investors to ensure certain volumes of product output. Perhaps the acceleration of the transfer of Intel 4 and Intel 3 technologies to Ireland occurred precisely at the request of investors, since they had already assumed their rights in this joint venture.
Patrick Moorhead, after talking with his namesake Gelsinger, who heads Intel, came to the conclusion that the company is experiencing certain problems with the level of product yield when releasing Meteor Lake processors. Intel’s CEO has not spoken directly about these problems, but the company’s customers have complained about their inability to obtain enough processors from this family.
Secondly, the possible existence of problems is indicated not only by Intel’s desire to place urgent orders for the production of additional batches of processors, which provokes an increase in costs, but also by the absence in the manufacturer’s plans of server processors, the elements of which would be produced using Intel 4 technology. All processors of the Xeon family 6 use Intel 3 technology. It is possible that the Intel 4 process technology will remain a niche technology of the company, the widespread use of which at this stage may be hampered by quality problems. Intel representatives do not directly comment on this issue.