Intel is facing challenges in its chip manufacturing business, and according to reports from the Taiwanese media “Commercial Times,” Intel has fully outsourced its sub-3nm process technology to TSMC. To address the downturn, Intel has also initiated a plan to reduce its global workforce by 15%.
The report cites a “semiconductor industry insider,” who noted that the high costs of investing in advanced process technologies have created a “winner-takes-all” scenario as competitors fall behind. Intel began outsourcing its CPU production, starting with the Lunar Lake series, to TSMC.
Although Intel continues to pursue its own chip manufacturing, companies like Broadcom are concerned about Intel’s ability to handle mass production.
According to Intel’s latest quarterly financial report, its chip manufacturing division reported a widened loss of $2.8 billion, with an operating margin of -65.5%. Intel acknowledged that expanding its Intel 3 and Intel 4 process capacity at its Irish plant has significantly strained profits.
The company is actively seeking to transform through cost-cutting measures, aiming to save $10 billion by 2025, partly by selling off some business units and suspending dividends.
The semiconductor industry insider stressed that Intel has no choice but to cut all unnecessary expenses and focus its resources on its core chip business.
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