Intel: Talk about the 10nm lag and strong competition from AMD, among others

Interview with George Davis, Chief Financial Officer of Intel, talks about the problems of the company and AMD processors.

The situation in the desktop processor market isn't ideal due to the Ryzen 3000 series and internal issues. Ironically, the company has had its best results ever . George Davis, Intel's Chief Financial Officer, addressed the entire situation in an interview with Barron's. He discussed the company's financial health in this American financial publication.

Intel has stalled at 10nm due to 'over-ambition' as the company's CEO Bob Swan put it. They continue with 14nm while AMD has already jumped to 7nm with its Ryzen 3000 processors. The company cannot meet the market demand for processors.

Intel's apparent calm despite problems

We are still very focused on gross margin. Everything from capital efficiency to the way we design our products. What we have said, however, is that the lag at 10 nanometers means that we are going to be slightly at a disadvantage in unit cost for a period of time. In fact, we gave a guide to the 2021 gross margin to help people understand it.

2023 is the period that we were finally guiding [when] we're going to see very strong revenue growth and margin expansion. We have to overcome this period in which the 10 nanometers are a little behind, since we are not optimized in a node in which we work. But [by] then we are moving to a cadence of two to two and a half years in the next nodes. So we are increasing spending by 7 nanometers, which will start to occur in the second half of 2021, because we believe that it is the right thing to do to do things competitively.

George Davis, Intel CFO

In the interview, Davis highlights that Intel will reach 7nm by the second half of 2021. Given this statement, Barron magazine moved the discussion towards AMD and the arrival of EPYC Rome, server processors. On this Davis highlighted:

We said we expected to have more competition in the next 18 to 24 months. And our perspective reflects that. Our view of the nature of that competition and its impact has not really changed since we gave [our] long-term forecast in May.

George Davis, Intel CFO

Source: TPU