Intel 'struggles' with next-gen Panther Lake CPUs as its Intel 18A yield rates are trash

Intel is reportedly struggling with its next-gen 18A semiconductor process that was meant to be one of the saving graces of the company but is delivering huge headaches for its next-gen processors.

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In a new report from Reuters, the production process that Intel is using to work its way back into securing chip-making deals for high-end, high-margin chips is "facing a big hurdle on quality as it puts newer technologies to the test". Intel has been promising its investors for months now that it would be increasing manufacturing using its new Intel 18A process.

Intel has spent billions of dollars developing its new 18A process node, including the construction and upgrades of multiple semiconductor factories, where it wanted to take the fight to semiconductor dominator, TSMC. Intel wants to shift from solely designing chips that TSMC produces for them, to owning a competitive contract manufacturing business capable of rivaling TSMC.

Intel has said its 18A process node is back on track after disappointing customers in 2024, with plans to launch its next-gen "Panther Lake" mobile CPUs in high volume starting in 2025. One of the key parts includes next-gen transistors and a more efficient way of delivering power into the chip (BSPD technology).

The company hoped that making an advanced high-end chip in-house would attract other big chip makers to use Intel Foundry, but there is another big issue: only a "small percentage" of the Panther Lake chips printed on Intel 18A have been "good enough" to make available to customers, according to Reuters' sources.

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These sources were briefed on Intel's test data spanning back to 2024, speaking on the condition of anonymity because Intel hasn't authorized those people to disclose this information.

Yields may move up or down as Intel Foundry optimizes its manufacturing process, with companies calculating yields in different ways, which makes this critical data a "moving goalpost", reports Reuters from the "two people and two additional sources with knowledge of Intel's manufacturing operation", said.

Intel's Chief Financial Officer, David Zinsner, said in a recent July 24 interview that yields generally "start off low and improve over time". When it comes to next-gen Panther Lake CPUs, Intel said in a statement on July 30 that "our performance and yield trajectory gives us confidence this will be a successful launch that further strengthens Intel's position in the notebook market".

Reuters' sources said that Intel has aimed in the past for yields of over 50% before ramping production because starting any earlier increases risk to its profit margin. Intel doesn't make most of the profits from chips until yields reach around 70% to 80%, an important thing for a chip as small as Panther Lake, where many defects would make it a hard sell, according to the same sources.

Intel has taken on quite the challenge with its new 18A process node, as it introduces multiple new technologies at the same time, in order to boost competitiveness against TSMC. One of Reuters' sources said this is an aggressive timeline for a rollout of unproven systems "set it up for failure" with one of the sources likening the effort as a "Hail Mary" football pass.

This includes a next-gen transistor design and a feature that improves power delivery into the chip through something called PowerVia BSPD (backside-power delivery) which is an industry-first PowerVia backside-power delivery technology, improving density and cell utilization by 5 to 10 percent and reducing resistive power delivery droop, resulting in up to 4 percent ISO-power performance improvement and greatly reduced inherent resistance (IR) drop vs. front-side power designs.

Intel said in April 2025 that it had started an important step in printing Panther Lake CPUs using its Intel 18A, known as "risk production". Intel showed multiple laptops with Panther Lake CPUs inside at Computex 2025 in May, but the problems haven't stopped for the company.

As of late 2024, only around 5% of the new Panther Lake CPUs were printed were up to its specifications, according to Reuters' sources. The yield figure rose to around 10% this summer, with Reuters' source cautioning that Intel could claim higher numbers if it counts the chips that didn't hit performance targets.