On Intel's (NASDAQ:INTC) July 2015 earnings call, management finally came clean about the difficulties that it had been facing with its 10-nanometer chip manufacturing technology. Products based on this technology were initially expected to arrive in the marketplace in 2016, but were pushed out to sometime in the second half of 2017.
According to a recent job listing posted on Intel's website, it would appear that the ramp of 10-nanometer may be pushed out even further, with products potentially not showing up until 2018.
The job listing
On Jan. 21, Intel put up a listing for a "Capital Analyst" for Fab 28, a chip manufacturing plant situated in Qiryat Gat, Israel. Per the listing, Fab 28 currently produces chips on the company's 22-nanometer manufacturing technology and will be upgraded to support the manufacture of chips on the company's upcoming 10-nanometer process.
Notice that the listing says that the site "will begin production on 10nm in approximately two years." The listing went live on Jan. 21, 2016, so exactly two years from that point would peg production start in Jan. 2018. However, if we give Intel the benefit of the doubt (although frankly following the 14-nanometer debacle they do not deserve it), let's suppose that they really mean 1.5 years.
This would still peg production start in the middle of 2017, implying that products won't really make it to customers in high volumes until late in 2017/early 2018.
Both TSMC (NYSE:TSM) and Samsung (NASDAQOTH:SSNLF), the two major leading-edge chip manufacturers that Intel claims to have a "manufacturing lead" over, are expected to begin mass production on their respective 10-nanometer technologies in late 2016.
But Fab 28 isn't Intel's only leading edge plant!
It is true that Fab 28 will likely not be the only factory that will pump out 10-nanometer silicon, but the listing very clearly indicates that Fab 28 will be "ramping as the lead High Volume Manufacturing (HVM) site on the company's latest manufacturing processes."
This quite plainly indicates that Fab 28 will be the first, if not then certainly among the first, to go into volume production on the company's upcoming 10-nanometer technology.
So, about that "manufacturing lead"
Intel CEO Brian Krzanich has argued that even with the manufacturing issues at 14-nanometer and the push out of 10-nanometer, the company still has a "manufacturing lead" over its key competitors as far as chip manufacturing technology goes.
It's interesting, though, that despite the protestations that it is "ahead" of the competition, Intel management has not publicly told investors when to expect 10-nanometer production to begin.
The fact that Intel remains silent on the timing of 10-nanometer production start, even though the foundries have already put their respective timelines on the table, strongly suggests that Intel will actually be behind in ramping its 10-nanometer technology.
Now, of course, Intel will tell investors that its 10-nanometer technology is superior to the competition's (and I'm sure in many ways it will be), but with TSMC claiming that production on its 7-nanometer technology will begin in the first half of 2018 (around when Intel's 10-nanometer will go into production), I'm not at all convinced that this comparison is even relevant.
Don't expect transparency from Intel, though
In my view, Intel isn't being more open about its manufacturing plans because it wants to ensure that the public perceives Intel to have some defensible, sustainable lead. If Intel really does have such a lead, then it shouldn't be afraid to spend some time explaining it to investors.
Will Intel actually host an event to fully explain this to investors? Unfortunately, I doubt it.