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Tuesday | October 19, 2021
Intel announces unprecedented processor shortage

Intel announces unprecedented processor shortage

As Intel presented its financial results, the company took the opportunity to warn of a shortage coming in the third quarter of this year (Q3 2021). The terms used by Intel are strong since the blue talk about an unprecedented shortage that will affect processors intended for the general public. But this time it’s the substrate shortage that is the cause, not production capacity. Indeed, the main reason for this new cold shower is entirely based on the tensions affecting the availability of substrates. A situation that impacts the entire semiconductor industry.

What is a substrate and why is it a problem?

If you don’t know what we’re talking about when we talk about substrate, it’s actually quite simple. The substrate on a CPU is the green part that acts as an electrical and mechanical interface between the processor and the rest of the components. This relatively simple part technically is not manufactured by the foundrymen who just take care of the die. However, it is part of the “final” stage of the production of a chip and obviously it is impossible to do without it. Intel doesn’t seem to have any problem to produce its dies but lacks substrates.


Under these conditions, everything suggests that in the third quarter Intel preferred to direct most of its production to its Xeon processors . The Xeon CPUs obviously generate a higher turnover and a better margin. However, it is estimated that for every one Xeon made, three or four mainstream processors are not made. In the current situation, Intel is prioritizing its CPU offering for servers, then CPUs dedicated to mobility and finally desktop CPUs.

Is the substrate shortage only affecting Intel?

The entire industry is affected by this substrate supply problem. Companies like Shin-Etsu and Global Wafers are already operating at 100% capacity and any increase in demand is clearly not absorbable. So TSMC or Intel are unfortunately dependent on these indispensable partners.


If Intel indicates that it will be more impacted (it is in fact a choice of the company), the blue see better for Q4. But what is interesting is that the subject has been taken seriously internally for a long time with the will to master this part of the production. We will come back soon to talk about a French player, very much at the forefront of this subject and which is moving forward with Intel.

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Edited by Calliers

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