Intel to produce 7nm chips on its own starting in 2023

Intel will be manufacturing 7-nanometer (nm) CPU on its own starting in 2023, company CEO Bob Swan said at its fourth quarter conference call on Thursday.

The company has been increasing research and development spending to develop 7nm since the second half of 2020, Swan said, and it was confident that it will begin commercial production of them in 2023.

Intel increased research and development spending in the fourth quarter by 9% from a year ago to US$5.4 billion. Swan said 7nm was reflected in the increase.

Incoming CEO Pat Gelsinger also mentioned in the conference that Intel will be expanding the use of outside foundries for certain technology and productions.

Intel didn’t mention which companies it would use for outsourcing production. Experts has floated both TSMC and Samsung Electronics as possible candidates.

Gelsinger is expected to take the helm of the US chip giant on February 15. His tenure comes at a critical time for Intel, which is considered to have stagnated in technology development and customers leaving. 

Intel is considered behind to TSMC and Samsung Electronics node progresses. Both Asian companies have already commercialized their own 7nm processes. Hedge fund Third Point in December asked Intel to shed its manufacturing business.

In the fourth quarter, Intel posted US$19.978 billion in sales and US$5.884 billion in operating income. This is a drop of 1.1% and 13.4%, respectively, from the same time period a year ago.

For the full year of 2020, Intel posted sales of US$77.867 and operating income of US$23.678 billion, a rise of 8.2% and 7.4%, respectively, from 2019.