Intel’s New CEO Considers Major Shift In Chip Manufacturing Strategy

Intel’s new chief executive is exploring a significant shift in the company’s contract chip manufacturing business in a bid to attract major clients, two sources familiar with the matter told Reuters, Max A. Cherney, Jeffrey Dastin, and Stephen Nellis reported.

Nvidia's pivot is aimed at attracting large customers like Apple and Nvidia, who currently rely on TSMC to manufacture their chips. I Photo: Intel Corporation

If implemented, the strategy would mark a departure from former CEO Pat Gelsinger’s plans by potentially halting efforts to market certain chipmaking technologies—specifically Intel’s 18A and 18A-P processes—to external customers.

Since taking the helm in March, CEO Lip-Bu Tan has moved swiftly to cut costs and reset the direction of the struggling U.S. chipmaker.

By June, Tan began signaling that 18A, a process Gelsinger heavily invested in, was losing traction with prospective clients, according to the sources.

Abandoning external sales of the 18A line—technologies that have cost Intel billions to develop—would require the company to take a sizable write-off. Analysts told Reuters such a charge could amount to hundreds of millions, potentially billions, of dollars.

Intel declined to comment on “hypothetical scenarios or market speculation.”

The company emphasized that Intel itself has always been the lead customer for the 18A process and said it plans to ramp up production of its "Panther Lake" laptop chips later in 2025—described as the most advanced processors ever designed and manufactured in the U.S.

Still, securing outside clients remains key to Intel’s foundry ambitions. With delays plaguing the 18A rollout, rival TSMC’s N2 technology remains on schedule. Tan is reportedly refocusing Intel’s foundry resources on 14A, a next-generation process where the company believes it can outperform TSMC.

This pivot is aimed at attracting large customers like Apple and Nvidia, who currently rely on TSMC to manufacture their chips.