Intel Foundry External Wafer Sales Forecast

 

Intel Foundry Forecast Dec 2023 (Mark Webb, MKW Ventures Consulting, www.mkwventures.com)

We have looked at Intel Plans, Customer reactions, and competitor reactions to develop a forecast for Intel Foundry

Today, Intel IFS  includes sales of mask making products and services in its foundry revenue. It appears this is actually the largest revenue segment in IFS per Intel 10Q reports. Intel also includes packaging and assembly services for external companies.

Intel actual wafer sales to other companies (wafer foundry) is quite small today. We estimate $100-200M per quarter. This would put them as the 15-20^th largest wafer sales foundry in the world.

 

In the future, Intel has plans for technologies and is sampling with many companies. If they execute, they will have leading edge technologies and capacity to ramp them.

We expect all major customers to move slowly with small portion of foundry allocation to Intel until 2027 timeframe. Many are planning to use Intel as a backup or to provide price negotiation pressure. TSMC is a dominant force in foundry and this is not changing. TSMC considers Intel a large customer and not a threat in foundry.  They may or may not be correct.

In our model, Intel always spends 2x the dollars outsourcing to TSMC as they receive in wafer foundry revenue from others.

The reported accounting will all change next year. Intel will try to report fab business as independent business selling to Intel BUs. They will quickly become a top 3 foundry. They will adjust the allocated cost to achieve the goals they want (ie: Allocate low cost to BUs to compare for TSMC foundry work.

The forecast for Intel External wafer sales is below: Note that this is based on Intel plans. If they do not execute or gain share, then they will go to the “Plan B” (Call us for what Plan B is)

We are at IEDM 2023 Dec 10-13 to discuss how we update this model each month. Call or text to set up meeting.

Mark Webb

www.mkwventures.com

Memory Market Update Dec 2023 Edition

 As we predicted in Feb, March, May, August and October, the memory market is recovering in Q4 2023. 

Reminder, we predicted this before it even bottomed and we are using the same cycle graph. 

The reason is that the market always behaves in cycles and the only real movement is inventory and price... you can see all the details on our website and 2023 FMS presentation which quantifies causes and effects. www.mkwventures.com

Summary of downturn: the Total bits sold in 2020-23 is Exactly what we expected in 2019... there was no drop. Customers just bought them all in 2020-early 2022. For some reason, no one noticed inventory build at customers that was clear (See earnings report transcripts for Q2 2022).

So where are we now?:

• Memory prices are recovering
• Since they are recovering, people are incentivized to buy and build inventory now.
• the recovery will get sharp until we reach profitability
• It is not clear how profitable we will get. That depends on inventory shortages in 2024/5 which we track.
• If we fall into the trap that [enter hype technology or geopolitical event] is changing long term demand, the 2026 crash will be bad as well. 
• DRAM bits will grow 15-18%. NAND Bits will grow 20-25% long term. Beware when people say "DRAM bits grew 15% in Q4 2024, We don't see any evidence of double ordering" 
• Obviously there will be a downturn in 2026. We help you predict whether it will be Minor (20% revenue drop) or Major (50% revenue drop)
• We can advise memory companies on how to meet demand without getting played by the customers and causing oversupply
• Call or text us to discuss more and learn how you can d

Mark Webb

www.mkwventures.com

HBM Market Forecast and Current Facts

 

HBM Revenue Model Key Facts:

• HBM Bits are <5% of DRAM Bits Today
• HBM Revenue is <10% of DRAM Revenue Today
• HBM Price/bit is >5x  of DDR4/DDR5 DRAM
• HBM Cost/bit is >3x of DDR4/DDR5 DRAM
• Today's Market is supply constrained, sole source per project, little price competition
• Tomorrow's will be price competition, aggressive moves to obtain market share

Call or text to set up meeting to discuss how the market will change over time, who will win, and why each of the three major DRAM suppliers is in a completely different starting position 

We are at IEDM in San Francisco Dec 10-13. Call or text to meet in person or set up a zoom call.

Mark Webb

www.mkwventures.com

Mark Webb, MKW Ventures Consulting at IEDM Dec 10-13 2023.

  

7 Topics for Discussion at IEDM 2023. Mark Webb, MKW Ventures Consulting LLC

              

                  1 HBM memory: It is the fastest memory and it powers the AI compute industry.

a.      How much does it really cost and how much capacity is needed and what will the supply chain be in 3 years?

b.      Why is only 10% of the DRAM memory in Nvidia Servers actually HBM.

c.      How do we think about “super near”, “really near”, ”sorta near”, “pretty far”, “very far” memory in Servers today and in the future? 2LM is now 5LM. Do emerging memories change this?

2 The Memory market is recovering exactly as we predicted in March 2023 (check our presentations and predictions). We also gave details to the memory market cycle at FMS 2023 and how it has nothing to do with Pandemics, recessions, AI, inflation, supply chain issues. It has to do with natural human response (or AI response) to inventory and fears in the market.

a.      What will happen in 2024? How profitable will memory be in 2024?

b.      Why is NAND so much worse than DRAM?

c.      Why will the market fall again in 2026 (and yes, everyone will be surprised)

d.      How can we prevent this cycle IF we choose to (we haven’t chosen to yet, but we could)?

e.      How can you predict the next downturn and recovery?

3 The last FINFET  technologies are ramping now. How long will they last and how fast will GAA technologies ramp in 2025? Why will FINFETS dominate volume into 2028?

4 Intel is currently not a top 10 foundry today. They want to be the 2nd largest foundry in 5+ years.

a.      What do they need to do to break into the top 5 foundries?

b.      How are customers working with Intel today and when will we see success?

c.      How do we track Intel success or challenges?

d.      How will TSMC and Samsung respond 

5 Speaking of Intel…. Intel has to correct its cash flow and business model quickly

a.      How to pay for new fabs (what is ACTUALLY happening on NET capex vs gross Capex)

b.      Will Intel really have 5 nodes in 4 years …. Or is it really 3 nodes in 6 years? We tell you what will happen so you are not surprised when you see the news in 2024, 2025

6 Trade wars, Export bans, a foundry in every country. What will Fab world look like in 2030?

7 AI servers are the cool thing. But, by far, most servers being built today are classic standard servers. What does this mean for the datacenter market.  How to see if this changes in the next 3 years?

We have the info so that you can correctly predict the market as well. Contact us for an in person or zoom meeting. We will be at IEDM Next week and can set up a Zoom call

Mark Webb

www.mkwventures.com