Intel leader pushes back on politics during 18A manufacturing struggles
Subscribe to our free newsletter today to keep up to date with the latest manufacturing news.
Intel’s upcoming Panther Lake processors, built on the company’s 18A manufacturing process, are central to its effort to reclaim leadership in advanced semiconductors. The 18A node is designed to deliver higher performance per watt and compete directly with products made by Taiwan Semiconductor Manufacturing Company and AMD. Panther Lake is also seen as a proving ground for Intel Foundry Services, which aims to attract external chip design customers.
The reality of Intel’s 18A yield rates
Industry sources report that the 18A node is currently producing usable chips at about 10 percent yield, up from 5 percent at the end of 2024. For comparison, industry norms for a profitable launch are above 70 percent, with 50 percent considered the minimum for break-even production.
Intel executives have disputed the lowest figures but have not confirmed exact numbers. While Chief Financial Officer David Zinsner projects steady improvement through late 2025, analysts warn the gap to profitability remains significant. One investment firm, KeyBanc, forecasts yields could reach 70 percent by the fourth quarter, which would keep the launch viable but leave little margin for error.
Potential financial and supply chain impact
Launching with low yields can force a company to absorb higher production costs or sell chips at reduced margins, potentially at a loss. For Intel, the Panther Lake rollout is tied to both product revenue and its credibility as a competitive foundry. Any delay could disrupt the PC supply chain, affecting availability for manufacturers and resellers.
A compromised launch could also harm Intel’s reputation with enterprise buyers, who expect predictable timelines. Competitors may seize the opportunity to capture market share in both consumer and data center segments.
Intel’s recovery plan and public messaging
In the midst of these manufacturing hurdles, CEO Pat Gelsinger has been managing a political dispute. President Donald Trump recently suggested Gelsinger should resign, prompting a firm response from the Intel chief in a letter to employees. Gelsinger described some circulating claims as misinformation and reaffirmed the company’s commitment to US manufacturing.
Internally, Intel has stepped up yield improvement initiatives, including process refinements, equipment upgrades, and closer coordination with materials suppliers. Management maintains that Panther Lake is still on track for introduction in late 2025, with consumer availability expected between September 2025 and March 2026.
Analyst opinions remain split. Some view Intel’s current yield levels as a temporary setback typical of advanced node ramp-ups, while others believe the shortfall could extend into 2026. The broader US semiconductor strategy, which depends on domestic production, also has a stake in whether Intel can resolve these technical and political challenges.
If Intel meets its year-end yield targets, Panther Lake could still arrive on schedule and restore confidence in the company’s technology roadmap. Failure to do so would strengthen competitors’ positions and raise deeper concerns about Intel’s ability to execute in the foundry business.
Sources: