It’s been another busy week in the chip world, with the announcement of a new Intel CEO spurring fears of larger layoffs and the company selling off its crown jewel fabs. Meanwhile, AMD continues its home run streak with another winning X3D processor arriving at retail.
We also learned more about the hijinks of GPU smugglers who bought more than a quarter of a billion dollars worth of banned AI servers under a ridiculous company name, and that’s assuredly just the tip of the smuggling iceberg.
We also learned that Huawei makes all of these chip smugglers look like beginners: It tricked TSMC into fabbing not one, but two million banned processors for its line of AI products. Meanwhile, scientists with one of China’s leading universities have developed an entirely new type of transistor that could outperform anything currently on the market. Let’s dive in.
Lip-Bu Tan brings hope (and some fear) to Intel
Intel named Lip-Bu Tan its new CEO this week. Tan hails from Synopsys, where he was CEO, and he is an immensely respected industry executive with a strong semiconductor pedigree. Tan’s arrival brings some badly needed hope to Intel, but it has also spurred plenty of speculation, and not all of it is good.
Tan previously served on Intel’s board, where he was brought in to help the company become a contract chipmaker for other companies. Surprisingly, Tan abruptly left Intel’s board last year amid swirling rumors of clashes between him and then-CEO Gelsigner. Those disagreements reportedly centered on the size of Intel’s layoffs; Gelsinger had launched the largest layoff in the company’s 56-year history, axing 15,000 jobs, but Tan reportedly felt the layoffs weren’t large enough and didn’t remove enough middle management. He also reportedly favored selling off Intel’s once-vaunted fabs.
Tan’s first meeting with Intel employees was somewhat ominous, citing coming “tough decisions,” likely referring to another serious round of layoffs. It’s rational to think Tan will also target the middle management ranks as he looks to make the company more nimble.
Tan’s intro letter to employees also said he would work hard to “restore ourselves as a world-class foundry,” which has largely been interpreted as a commitment to keeping Intel Foundry within the company. That might not be the case entirely, though.
Intel has already planned to split the foundry into its own wholly-owned subsidiary, and the company recently announced it is looking for financial partners for that initiative. This would make Intel Foundry a separate operating entity with its own P&L and management team. Once the fab subsidiary is financially stable, it certainly wouldn’t take much more to separate it completely later (provided the situation with mature nodes is sorted), so these could be interim steps to an inevitable future of a fab-less Intel.
All of these developments come during extreme turbulence at Intel Foundry; the company recently delayed the build-out of its Ohio operations until 2030. But at least there was some good news this week — Intel appears to be running its first 18A wafers through its Arizona fabs, an important milestone. I’ll be at Intel’s upcoming Foundry Direct Connect event to learn more.
China’s chip smuggling continues, but country has its eye on the future
The United States’ continued chip bans on China have been a boon for chip smugglers, with this week’s news revealing two distinct ways smugglers have profited from getting restricted chips into the eager hands of Chinese companies.
The first involves a ring of three individuals who bought AI servers from Supermicro and Dell with banned Nvidia GPUs onboard. The individuals formed a fake company called “Luxuriate Your Life” to purchase $390 million worth of servers, which were then smuggled into Nvidia. The men have now been charged with defrauding Supermicro and Dell by lying about their fake company. Still, it’s a bit of a leap to assume there wasn’t at least some suspicion when a company named “Luxuriate Your Life” purchased nearly half a billion dollars worth of server equipment.
The case is just the tip of the iceberg: Singapore is investigating 22 individuals and companies for fraudulently obtaining servers for China. Meanwhile, the three accused men are now out on bail. They face up to 20 years in prison.
China’s Huawei makes everyone else look like amateurs, though. Huawei is banned from buying chips fabricated with the 7nm or smaller process node, but the company allegedly used shell companies to trick TSMC into manufacturing two million compute chiplets for its Ascend 910 AI processors, which chip analyst firm TechInsights then discovered.
Naturally, TSMC cut those companies off immediately, and the US government is still investigating. However, now the sheer scale of the operation has come to light, and it appears that Huawei will package two of these ill-gotten dies together to make its next-gen AI flagship processor, the Ascend 910C.
That will buy Huawei some time, but the company will eventually run out of its chip stockpile. What’s next? Huawei is investing heavily in its own third-party foundry network to make future chips, and China as a whole isn’t going to take these restrictions lying down.
As Western countries continue to race to smaller nodes, as we see with this week’s announcement of ASML and imec’s sub-2nm node partnership, China is exploring entirely new paths — this week, a research team at Peking University revealed the world’s first 2D low-power GAAFET transistor.
If these transistors live up to the claims made in the teams’ Nature paper, that could lay the foundation for faster and more efficient chips than anything on the market. These new transistors use Bismuth instead of silicon, showing that inventive new techniques, borne of necessity, might help the country overcome US restrictions and competing Western chipmakers.
AMD scores another walk-in touchdown
We covered several hot news stories this week, but AMD’s release of its Ryzen 9 9950X3D made news of its own. With an exceptional blend of performance in both gaming and productivity apps, this chip arrived to rave reviews from almost every outlet as it trounced Intel’s chips in dominating fashion.
It isn’t a great look when a competitor beats your flagship chip by 39% in anything, but that’s exactly what the 9950X3D did to the Intel Core Ultra 9 285K in gaming.
This kind of performance domination is becoming more common with AMD’s gaming-optimized 3D V-Cache chips. Still, that top-tier gaming performance used to come with a somewhat severe trade-off of reduced performance in productivity applications. However, AMD’s new second-gen 3D V-Cache has removed that tradeoff almost entirely, making these chips far and away the best choice if you have to cash to pay the extra premium.
Intel doesn’t have comparable technology in its desktop PC chips, and it’s beginning to look like it won’t have a rival for at least another two generations. Meanwhile, AMD has also worked 3D V-Cache into its mobile processors, giving it an easy win in any device where they use the tech. That doesn’t bode well for Intel’s future in high-end gaming systems. Here’s hoping Lip-Bu Tan can right the ship.
