Patrick Moorhead
Covers the tech industry broadly: cloud infrastructure, enterprise software, semiconductors, and increasingly the economics of AI data centers and chip supply c...
“The semiconductor business is a cruel business in that if you find yourself with the wrong architecture, you're literally going to have a hard time fighting back. It'll take you four years. You lose the recipe in a foundry, it could take you even longer. And then when you try to connect the two together, which Intel is doing between design and foundry, it is and continues to be a challenge.”
The Information's TITV · October 2026
Context
On the morning Intel shares fell about 25% after earnings, the host asked when its foundry business turns a profit; Moorhead said he expects 2029 or 2030. Here he explains why chip turnarounds take so long.
Transcript
…the foundry, but also the transistor technology. And then you have to get far enough along so you attract customers, right? Lipu Tan, Intel's CEO, did talk about they would make some announcements in the next two quarters on foundry customers, which I think is very important. But we're waiting,
we're waiting to hear. No, no, no, no.
I know. I mean, it's likely Google and AWS on the packaging side. It's on the wafer side that is the biggest unknown, but I do believe that it's going to be NVIDIA and Apple out of the gates because they need a second source and they also see the need to manufacture more in the United States. And a lot of that capex that's going in right now that's making them cash flow negative is investments that is going into 14A node and 18A and AP nodes to build out the capability. The semiconductor business is a cruel business in that if you find yourself with the wrong architecture, you're literally going to have a hard time fighting back. It'll take you four years. You lose the recipe in a foundry. It could take you even longer. And then when you try to connect the two together, which Intel is doing between design and foundry, it is and continues to be a challenge. So I look at milestones. Was Intel able to crank out 18A? Check. Yields are getting better every quarter. Is the feedback on their early designs called PDK kits for 14A? It looks like everything is out on time. And what I'm hearing in the ecosystem is those are higher quality. And in 2027, you have this convergence of…
Right. Hey, Patrick, so I know you said you're obviously looking ahead to AMD earnings, but based on the commentary that we got and the results we got from Intel, what are you expecting from the other chip companies, broadly speaking? How does this affect what you think they might report?
I think data center, it's going to be full steam ahead. I think TSMC will cross every bridge. And break every rule to be able to give AMD what it needs on the server side. And then on the PC side, we will likely see a lower number from Intel, right? Because they're all selling to the same people.…
Right. But just very quickly, so you talk about AMD, but what about all the other chip companies that inevitably do rely on the same memory in many cases?
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