Microsoft and Intel reach a billion-dollar custom chip agreement

Microsoft and Intel reach a billion-dollar custom chip agreement

Intel said that it has rebranded its chip manufacturing division as Intel Foundry. The corporation says the redesigned enterprise is the “world’s first systems foundry for the AI era.” It was formerly known as Intel Foundry Services.

The business also plans to introduce its new Intel 14A technology in 2026 to maintain its advantage. Microsoft is going to use Intel’s 18A technology for a chip that isn’t yet known, which will help Intel meet its forecast of $15 billion in foundry orders, up from the $10 billion that was previously predicted.

Regarding this new processor that Intel Foundry would produce for the business today, Microsoft did not disclose any information. Microsoft revealed two new specially crafted CPUs suited for AI workloads in November 2023.

The Silicon Valley corporation hasn’t disclosed any information about its ambitions beyond 2025 until now, with the announcement of 14A technology. When he took over as CEO of Intel three years ago, Pat Gelsinger set the goal of returning to the top spot in the semiconductor industry.

“We are in the midst of a very exciting platform shift that will fundamentally transform productivity for every individual organization and the entire industry,” said Microsoft CEO Satya Nadella in the official press release.

Several of Intel’s foundry business partners, including Synopsys, Cadence, Siemens, Ansys, Lorentz, and Keysight, were disclosed today. These businesses will all provide “tool qualification and IP readiness” so that clients, such as Microsoft, may expedite the creation of chips that use the Intel 18A process.

With profitable alliances with businesses like Apple, Qualcomm, and AMD, rival Taiwan Semiconductor Manufacturing Company (TSMC) has found success by relying on manufacturing other people’s designs. A key component of the company’s approach, according to Gelsinger, is its foundry, as he told VentureBeat today.

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