Is AMD taking Intel’s market share?

Intel announced in late July 2020 that the company’s technology roadmap is expected to be further delayed. From this we can expect for AMD to likely take the further market share from Intel in the future.

Currently, nearly half of AMD’s sales come from TSMC’s 7nm process products. However it is planned for more of AMD’s semiconductors to be manufactured by applying TSMC’s leading-edge process technology. In contrast, Intel said the company’s first 7nm process product launch schedule will be delayed again until 2022 or early 2023.

In the x86 architecture processor market in 2019, AMD is estimated to have about 15% share, while Intel has 84% ​​share. AMD is Intel’s only significant challenger in the CPU market, who is working closely with its foundry partner, TSMC.

TSMC announced In response to the slowdown of Moore’s Law, they work to achieve performance improvement, power consumption reduction, and transistor density improvement.

AMD’s server chips will probably use 5nm process in 2021. AMD also plans to move to TSMC’s 3nm process by 2023. Therefore, AMD can be said to have reasons to increase its market share.

TSMC, the world’s largest foundry, says it will stop manufacturing 7nm process chips for HiSilicon in September 2020, after Huawei’s subsidiary HiSilicon was listed on the US government’s blacklist. For this reason, AMD is trying to increase the production of 7nm process chips allocated to TSMC. HiSilicon accounted for approximately 14% of TSMC’s total production in the first quarter of 2020.

Intel’s packaging technology’Foveros’ is far superior to TSMC’s chiplet solution because it uses 3D stacking. Thus Intel has some key strengths in its competition with AMD. Intel is able to appeal to customers for a low price, and it also has architectural strengths such as “DL (Deep Learning) Boost” instructions and “AVX512”.

Intel recently revealed that it may expand manufacturing outsourcing to TSMC and other foundries. Until now, Intel has outsourced the manufacturing of chips that apply old-generation technology to TSMC, but it will be the first time that the foundry will be used in manufacturing using cutting-edge processes of 10 nm or less.

Bob Swan, who took over as CEO of Intel in January 2019, said in late July about the company’s expansion including outsourcing to foundries during a conference call following the announcement of its quarterly results.

AMD sold out all its semiconductor factories to become a fabless maker a few years ago, but it’s unlikely that Intel will outsource all manufacturing in a way that AMD did. Intel has to decide whether the company is a manufacturing company, a product company, or a mix of both.

Every new process technology has its challenges, but the wrong choice can lead to delays of months to years. All semiconductor manufacturers relying on state-of-the-art processes are unpredictable. There is a need to have a workaround for every situation, and no manufacturer can escape it. Intel has the flexibility to combine chips from different foundries in the future.

Intel’s stumbling block is another sign that the US semiconductor industry is losing its vitality. Intel’s plan to outsource manufacturing worries the United States government.

AMD is pushing out. Intel in the processor market because AMD’s products have a great design made by TSMC. TSMC is the only way Intel can keep up with AMD. As a result, Intel will be under increasing pressure to outsource to TSMC (Intel is already positioned as one of TSMC’s key customers).

RR