Intel’s CPU roadmap may have run into another hitch as TSMC has delayed its 3nm (N3) production to the first half of 2023. Team Blue is set to outsource the production of its Meteor Lake iGPU tile over to TSMC’s N3 node, a first for the chip giant. Originally planned for late 2022, the mass production of the 14th Gen family has likely been postponed to the very end of 2023, or maybe even 2024.
Intel plans to outsource the tGPU chipset in Meteor Lake to TSMC for manufacture. Mass production of this product was initially planned for 2H22 but was later postponed to 1H23 due to product design and process verification issues. Recently, the product’s mass production schedule has been postponed again to the end of 2023 for some reason, nigh completely canceling 3nm production capacity originally booked in 2023 with only a marginal amount of wafer input remaining for engineering verification.
Intel has been one of TSMC’s surprise clients, reserving vast amounts of advanced process capacity, including N3 (3nm) and N2 (2nm) to supplement its own 4, 20A, and 18A nodes. However, with the growing reliance on the Taiwanese foundry, wafer shares have been getting pricier and harder to allocate with the American chip giant also getting the short straw.
It is worth mentioning, that although Intel has significantly adjusted its 2023 outsourcing plan, causing TSMC to postpone its 2023 expansion plans, looking at other advanced process clients including AMD, MediaTek, and Qualcomm, all of these companies successively plan to mass-produce 3nm products in 2024. At the same time, Apple’s new 2024 iPhone is expected to fully adopt 3nm processors. The introduction of the aforementioned clients will inject momentum into TSMC’s 3nm capacity utilization and revenue performance in 2024.
Apple is TSMC’s premier customer with AMD, MediaTek, and Qualcomm have been getting second-grade with every new node. Earlier, it was rumored that Intel will be taking a seat alongside Apple as a first-tier client but going by recent events, I’d say that’s unlikely.
Looking forward to 2024, with new products from clients such as AMD, MediaTek, and Qualcomm in place, 3nm process output is expected to be on track, further promoting strong growth in TSMC’s revenue scale. However, the development status of Intel’s own Intel 4 process and the accompanying outsourcing situation are still important potential growth drivers for TSMC. If Intel 4 fails to mass-produce as scheduled, Intel may outsource its computing tiles to TSMC, strongly driving growth in 2024. However, if the Intel process develops smoothly, there remains the possibility of the company choosing to manufacture related products itself and canceling TSMC’s orders.