Tick, Tock, Boom! A Cannon has interrupted the Intel waltz once again

Subject: General Tech | May 8, 2018 - 02:52 PM |
Tagged: Intel, cannon lake, H310

Cannon Lake and their 10nm process have proven a serious problem for Intel these past few years.  It was in 2016 that they originally announced Cannon Lake would be delayed a year, which was then corrected to 2018.  Barely a week ago we heard from Brain Krzanich that 2018 was too optimistic a date, and the 2016 CPU is now scheduled for some time in 2019. 

Along with the Cannon Lake delay, DigiTimes also reports that the supply of the 14nm H310 chipset has completely dried up and we may not see more for a month or so, with July being the latest expected date.  This means the only low teir Intel motherboard available for system builders, both professional and home, is the B360.  

The next quarter's financials for both AMD and Intel should be very interesting.

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"Intel initially planned to launch 10nm Cannon Lake CPUs in July 2018, but its CEO Brain Krzanich unexpectedly disclosed at a meeting with financial analysts in late April that volume production of 10nm chips will be moving from the second half of 2018 into 2019 as it will take time to improve yield rates."

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Source: DigiTimes

May 8, 2018 | 07:49 PM - Posted by OnlyTheLeanCanProsperInTheLowerMarginMarket (not verified)

Keep and eye out for Intel's Gross Margin figures over the next few business quaters as AMD's Epyc Server Market sales/market share begin to go up.

AMD's Opteron sales and server market share put Intel's Gross Margins on a downward slide as Intel had to lower its unit markups in order to keep AMD's Opteron from taking even more server market share/sales revenues away.

Also look for Intel to begin consolidating some of its lower margin offerings in favor of those that produce higher margins and Intel will be doing that in its consumer market to a greater degree than in its server offerings at first. Intel is going to be under far greater margin/markup pressure for AMD's Epyc in the server/HPC markets than Intel was ever in against AMD's Opteron as Epyc is a good deal more performant against Intel's Xeon than Opteron ever was.

Intel is sure to begin pruning back its wide array of consumer offerings if they can not produce enough extra revenues to justify their existance. So look for Intel to become more focused on the highest margin consumer market and leave the lower margin sales to an AMD that can actually make some profit on those lower margin sales.

AMD is a fairly lean operation that was able to produce an 11 cents a share profit on Gross Margins of around 36%. And that makes AMD a very low overhead and lean business operation relative to Intel that has to maitain much higher Gross Margin metric in the above 55% range(63% Currently) in order to pay all those high fixed costs related to chip fab ownership and a larger size workforce and middle management pay/perks expeneses.

Intel is sure to not bother with a consumer low end where AMD has such a great advantage in pricing latitude that Intel will not be able to match without losing billions. Intel will have to quickly make some painful cuts to its fixed expenses if Epyc sales takes off too quickly in the professional markets and Intel will have to reduce markups or offer rebates in the server/HPC markets where Intel really earns its bread and butter revenues from.

May 8, 2018 | 08:50 PM - Posted by Anonymousss (not verified)

This is worse than spam for dick pills.

May 8, 2018 | 11:35 PM - Posted by ThatOldHagOsorousWithTheBigCashBagOfSwag (not verified)

Oh your poor mother(Intel) is so careless with that sitting on that BIG fat bottom for so many many years and Milking the Market while downing the mallomars by the truckload. And now that AMD's Epyc is here and doing production workloads in the server room at such an affordable price/performance metric, well, the fat old hag(Intel) can not even pivot fast enough without breaking a hip or two.

Look at those Intel high overheads with those big cash hungry chip fabs and that 10nm process with their yields so low that even Intel's cash bags can not help. Or the Fat Intel Middle Management lards so accustomed to the big fat perks for all of that little work towards innovation in the CPU/Graphics market for over a decade now!

And look for that old hag to bring out the milk and cookies(Contra-Revenue) sorts of monkey business in order to buy some more friends to keep the competition down in an anticompetative manner(1).

Raja and Keller can not fix things in a time frame measured at best several years for any fully new from the ground up CPU or GPU designs. And things can not be rushed out the door quickly enough to fix the cash bleeding that will begin over the next few Buisness Quarters as the fat old hag tries to hide the margin figures from the Wall Street Quants.

Those Fat Intel Margins are going on a diet there can be no question about that! And AMD's Epyc will be so very much a drop in replacment in the x86 based server market with a much better price/feature metric. IBM's/Nvidia's OpenPower Power9/Volta will take some of Intel's server market share also along with some more ARM based server clients.

Oh My Margins, moans the fat old blue whale of a mother as that pivot breaks off at the hip joint and the long and painful process begins to pull that beached whale of mostly blubber back into the deeper waters just to hide things from the investors and the Wall Street analysts!

(1)

"Contra-revenue comes back in a big way at Intel
Officially nothing is happening….look a shiny thing over there!"

https://semiaccurate.com/2018/05/08/contra-revenue-comes-back-in-a-big-w...

May 10, 2018 | 05:08 AM - Posted by msroadkill612

"Keep and eye out for Intel's Gross Margin figures over the next few business qua(r)ters"

Absolutely. I have long said that even if Intel's sales volumes look OK, their's is a hi margin biz model, and that is not being sustained due to AMD's onslaught. Fundamentally, they are in trouble tho it may not seem so from the numbers.

I would add that "pruning back its wide array of consumer offerings" isn't so simple when you own the fabs that make them. Not only are many billions in infrastructure idle/underutilised, the are ruinous even to mothball.

Investors should note that management 101 teaches you should always hide a little in the good years, to tart up the books if you hit a lean patch.

The bad news will be hidden long enough for insiders to sell out.

May 8, 2018 | 11:24 PM - Posted by Odin (not verified)

I called BS on the timeline way back in 2015 just as I call BS on TSMC's 7nm next year.

May 9, 2018 | 07:28 AM - Posted by JohnGR

TSMC and Samsung are in a constant fight to get the next iPhone SOCs. They can't delay their manufacturing advancements. Intel can find a dozen of excuses and even choose to look bad, as long as it still has the bigger slice of the market and doesn't feel the need to bring something newer in the market. TSMC's 7nm will come ON TIME.

May 9, 2018 | 01:34 AM - Posted by James

Their release timeline has been disrupted. It isn’t surprising that there has been issues with chipsets and such. They weren’t planning on needing 6 and 8 core processors in the mainstream. The chipset time table probably has to get pushed forward faster than expected also, and they hit some issues.

I am kind of curious how long they planned on holding back. The 4 core CPUs with integrated GPUs were not that much smaller, if at all, than a 6 or 8 core cpu. An 8 core cpu could have been mainstream years ago at 22 nm; it would have been higher end mainstream, but still more mainstream than their ridiculously expensive HEDT parts are. They wanted to keep their ridiculous prices on more than 4 core Xeons for the professional market.

They also wanted to stall software optimization, since any optimization for multithreading helped AMD and weakened their strongest feature; single thread performance. I have wondered if current high-end video cards are stressing 4 core CPUs to the limits. There are almost certainly features that developers did not use or implement because they were targeting the mainstream, which was only 2 or 4 cores at best. Six to 8 core should be the mainstream, midrange part now, and 4 core processors should be the low end.

I am stuck with a lowly 4 core Xeon for my desktop at work, not even HT enabled, because of intel monopolistic behaviors. I am planning on building a Ryzen 2700x system at home and I am tempted to set it up to run my work stuff. It would be nice to have ECC memory, but it looks like Ryzen Pro is not sold outside of OEM systems. The regular Ryzens are supposed to allow ECC, but thy are not qualified for that. I am thinking about second gen Threadripper, but that will not be until this summer and the motherboards are very expensive. They should have another socket that is smaller for the 4 channel memory part rather than using the Epyc sized socket. I don’t know if that would reduce the price much, but it would have allowed more standard sized cololers and such.

May 9, 2018 | 04:01 AM - Posted by Martin (not verified)

Intel 4-core (7700K) is ~125mm², 6-core (8700K) is 149mm².
Ryzen 1x00 8-core is 213mm² and Ryzen 2x00 8-core is 209mm².

- GT2 integrated graphics is in the range of 40-45 mm² in Intel's 14nm CPUs.
- Vega graphics on Raven Ridge (2x00G/U) appear to be fairly large at ~100mm².
- Zen 4 cores are (according to AMD) 44mm² vs Skylake 4 cores at 49 mm².

This leaves a whole lot for space being taken up by uncore stuff and cache. That part of the core does seem to be a bit larger on AMD Ryzen CPUs.

As a whole, it is a bit surprising that AMD is able to sell bigger CPUs for cheaper :)

May 10, 2018 | 06:03 AM - Posted by msroadkill612

For what you get, I think upscale moboS are a bargain and I cant see why folks fuss so much about an extra ~$100, when you consider the cost and hassle of retro fitting those extras if you discover you do need them after all.

Consider the extras on a TR4 board over AM4 - huge. 64 lanes, double memory bandwidth, triple nvme onboard, native bios raid for 7x nvme, ...

AM4 & even worse, Intel moboS, are so lane starved, you effectively turn your back on the true power of nvmeS. You are limited to a single full strength nvme on am4, and zero on intel (nvme ports on the chipset are not full speed ports).

So yes sir, imo you should seriously consider an 8 or 12 core TR, or even an 8 or 24 core epyc.

If you look after the fundamentals, performance and longevity will look after themselves.

Similarly, get a sibling~ AMD gpu. Increasingly, both processors are used as a team by apps to generate big leaps in performance.

You can compare (& observe in Taskmanager) Youtube viewed on Chrome vs MS Edge browsers - MS use the gpu to render much faster.)

As little as $350 for a tr4 mobo - meh, $100 more than some fundamentally wimpy am4 boards.

The extra price is very fair bargain. Those 64 lanes require a huge increase in circuitry.

May 10, 2018 | 06:06 AM - Posted by msroadkill612

I deleted this double post

May 10, 2018 | 06:41 AM - Posted by msroadkill612

Your first paragraphs about intel hubris gimping the mainstream runs deeper than raw processing power.

It has been even more drastic in connectivity.

By deliberately gimping it at the low end, they leverage users upscale.

Famously, most intel dual socket server clients have no interest in that expensive option, other than to get more connectivity lanes.

So yes, its like US cars in the 1960S. Arrogantly make them bigger and more powerful, but fundamentally inappropriate and crudely engineered.

They didnt count on toyota, and intel didn't count on amd's Zen.

The reality for most is processing power the least of our platform problems. The rapid uptake of nvme will bring this to the fore very shortly.

May 9, 2018 | 04:02 AM - Posted by Anonymouse (not verified)

So basically, they're still selling every chip they can fab so have little impetus to rush.

May 10, 2018 | 07:17 AM - Posted by msroadkill612

Um, no.

Due to the rush knee jerk responses to Ryzen, they are having unsurprising screw ups on an unplanned product. Its not they dont have enough, its they dont have ANY chipsets.

Intel would say its a shortage of silicon - what rot.

Far from sitting pretty, in desktops, intel can pretty much scratch any processor of theirs under $200 when you consider the $100 & $170 (list) amd APUs. Not all, but the large majority are unsalable in volume now.

They have had a big but very lopsided win in recent months with the popular ~8700k cpus, which are blessedly upmarket and hi margin.

The rest of their product line is pretty lame, and getting slammed by ryzen. These recent standouts are however, under new attack from a slightly improved but in critical areas, Ryzen+ from a more cost efficient AMD.

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