KeyBanc Reports Intel’s 18A Process Yields Reach 55 Percent, Analyst Warns It’s Premature to Declare Turnaround

This article is for informational purposes only and should not be construed as investment advice. The author holds no positions in any of the stocks referenced.

Intel’s Bold Leap: The 18A Process

Intel has taken significant risks with its future by heavily investing in its forthcoming 18A process. Recent developments indicate that progress is being made, yet analysts urge caution before making any definitive conclusions.

Current Yield Improvements

Keybanc Capital Markets: “$INTC current 18A yield has reached 55%, an improvement over the previous quarter’s 50%, closely trailing $TSM 2nm yield (65%) and surpassing Samsung’s SF2 yield (40%).”Keybanc projects that Intel’s 18A yield could reach 70% by Q4 2025.pic.twitter.com/cfzG6pMSff

— Ray Wang (@rwang07) July 16, 2025

According to KeyBanc, Intel’s yields for the 18A process have improved to 55%, marking a notable increase of 5% from the previous quarter. This advancement places Intel ahead of Samsung’s SF2 yields while nearly matching those of TSMC’s 2nm yields.

Future Yield Projections and Industry Impact

KeyBanc further forecasts that Intel’s 18A yields could reach an impressive 70% by the fourth quarter of 2025. This forecast highlights expectations of sustained improvement as Intel seeks to align itself with formidable competitors in the semiconductor industry.

In a contrasting view, Wells Fargo has issued a cautious outlook regarding Intel’s potential for a turnaround, emphasizing the need for a “net-positive” update on yield progression during its upcoming Q2 earnings call. This update will be pivotal for Intel’s foundry division, as breakeven is targeted for 2027, which is crucial for the company’s future vitality.

Launch Timing and Competitive Landscape

The timing for launching the 18A-based Diamond Rapids Xeon CPUs remains uncertain, with Wells Fargo suggesting that while the Panther Lake CPUs may debut by late 2025, widespread availability may not materialize until the first half of 2026.

At the recent 2025 Symposium on VLSI Technology and Circuits, Intel highlighted that its 18A process will provide 30% more density than its current 3nm process, deliver 25% higher frequency at ISO, and reduce power consumption by 36% for the same frequency output.

Market Dynamics and Intel’s Challenges

Competitor AMD is expected to further expand its market share at Intel’s expense, primarily through its forthcoming 2nm-based Zen 6 EPYC platform. Notably, Wells Fargo asserts that Intel faces significant competitive pressures on the client computing front from both AMD and ARM-based solutions.

Financially, Wells Fargo anticipates that Intel’s gross margins will remain suppressed, limiting prospects for a robust recovery in the face of competitive challenges within both client and server markets. As a result, they have set a price target of $22 for Intel shares, reflecting current market conditions.

A Leadership Test and Future Aspirations

This challenging situation serves as a critical test for Intel’s CEO, Lip-Bu Tan, who has openly acknowledged the company’s struggles in key areas. Tan aims to transition Intel towards an “engineering-focused” organization, especially with ambitions for the 14A process to elevate the foundry division to compete effectively with TSMC.

However, achieving stability with the 18A process is paramount, while developing a competitive rack-scale offering will be essential for Intel to contend against leading players like NVIDIA and AMD.

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