Intel shocks with 7nm delay - yields are 1 year behind internal target

Together with the company's Q2 2020 earnings, Intel shocked investors and the tech community by announcing a delay of its 7nm process technology. After all the issues Intel has with getting 10nm out of the door, which included many years of delays, the chip giant now confesses that 7nm isn't doing as good as anticipated.

Yields of Intel's 7nm process are trending "approximately twelve months" behind the company's internal target. This results in a six months delay of the first 7nm CPU, meaning 7nm consumer chips will not hit the market until late 2022 or possibly even early 2023.

The Xe-based Ponte Vecchio GPUs will not be made on Intel's 7nm node. It appears rumors about outsourcing were correct as Intel confirmed it will use a "contingency plan" by tapping another foundry for the production of its 7nm GPU. It's unknown what this means for Intel's plans to enter the consumer GPU market. Maybe the production of those chips will be outsourced too, but Intel didn't provide an update, so it definitely seems like discrete Xe video cards will not be ready anytime soon.

Intel's statement also reveals Alder Lake-S should launch in the second half of 2021.

Intel is accelerating its transition to 10nm products this year with increasing volumes and strong demand for an expanding line up. This includes a growing portfolio of 10nm-based Intel Core processors with “Tiger Lake” launching soon, and the first 10nm-based server CPU “Ice Lake,” which remains planned for the end of this year. In the second half of 2021, Intel expects to deliver a new line of client CPU’s (code-named “Alder Lake”), which will include its first 10nm-based desktop CPU, and a new 10nm-based server CPU (code-named “Sapphire Rapids”). The company's 7nm-based CPU product timing is shifting approximately six months relative to prior expectations. The primary driver is the yield of Intel's 7nm process, which based on recent data, is now trending approximately twelve months behind the company's internal target.