Intel CFO announces plans to deal with the chip supply problem
Bob Swan, who holds the titles of interim chief executive officer (CEO), as well as chief financial officer (CFO) at Intel, has published an open letter on the company's website. It is directed at the current situation of low supply that the company finds itself in.
Swan attributed this issue to the unexpected uptick in the size of the total PC market this year. The CFO conceded that it "had put pressure on our factory network". Therefore, the letter went on to state that Intel would be prioritizing the production of Xeon- and Core-series processors to service the higher end of this market. However, Swan also conceded that the supply at the other end was constricted.
The letter did also claim that Intel has the supply necessary to meet the previously-defined revenue forecast for 2018, which was "$4.5 billion higher than our January expectations". Swan also outlined measures to deal with the company's supply issues. They mainly take the form of a US$1 billion dollar capital investment increase for its 14nm processing plants in Ireland, Israel and the United States, and a new, "customer-first" approach.
Swan also asserted that 10nm processor production was now at improved yields and on track for the volumes projected for 2019. The letter also included references to various other markets (e.g. enterprise data and cloud services) in which Intel is performing well, in addition to continuing consumer confidence in and preference for its brand. This may be for the benefit of Intel's share price, which may have suffered as a result of market reactions to the increased chip shortage.