11/27/19 Dell Slaps Intel!

On 11/20/19 Intel put out a Supply Update letter, which apologized to its customers the now famous Intel CPU shipment delay and shortage problem. However, Intel remained adamant that such problem is due to the increased demand from “sustained market growth”.

Charlie Demerjian at Semiaccurate had published an excellent article, which completely debunked such baloney. The main problem is Intel is still having a lot of problem with their 10 nm process, despite what Bob Swan kept insisting. As a result Intel is still heavily dependent on their 14 nm for mobile CPUs, such that only a small portion of their mobile offering consists of the 10 nm Ice Lake. The rest are all 14 nm Whiskey Lake and Comet Lake, which actually are superior to the 10 nm Ice Lake, and they are cheaper to boot. So bad progress with 10 nm results in low supply of such CPUs.

Since AMD has been relentlessly increasing core counts since 2017’s Zen 1, Intel had to respond by also increasing their core counts. This increase in Intel’s die size directly reduced the number of CPUs they can make from the same number of wafers. Whereas Intel was happily selling 4 cores CPUs for many years, now they have to sell 6, 8 even 10 cores. This definitely decreased their CPU supply.

So now comes a third party confirmation from Dell, which directly contradicted Intel’s story line. Dell reported lower revenue from PCs, and lowered their guidance for 2020, citing low and inadequate supply of CPUs from Intel. So Dell is saying that Intel’s supply shortfall is not due to incredible increase in demand, but Intel’s supply falls short of what they supplied in the past.

[“Intel CPU shortages have worsened quarter-over-quarter, the shortages are now impacting our commercial PC and premium consumer PC Q4 forecasted shipments,” Dell Vice Chairman Jeff Clarke said in an earnings conference call Tuesday afternoon.]

Meanwhile HP, who uses more AMD’s Ryzen CPUs, did not have this same problem. In fact, HP’s PC business had a revenue growth of 4% in their latest Q4 report. HP further confirmed the Intel CPU shortage problem, which will “constraint its sale in the current quarter”.

It is well known that Dell took a lot of Intel’s bribe money to use Intel CPUs preferentially for years. It is much easier to find Ryzen in HP’s PC offerings. One example is this HP Pavilion desktop, which features the latest Ryzen R7 3700X.

The solution for Dell is simple. Just use more AMD! Perhaps Dell is finally figuring it out. In this HPCwire article, Dell/EMC is supplying Australia’s Pawsey Supercomputer Center with Epyc servers featuring Rome CPUs. Since Dell has been such an Intel shop, increasing use of Epyc by Dell/EMC is a very good sign for AMD. As for Dell, it would be very foolish to keep staying away from AMD, in spite of Intel’s bribes.

BOA’s Vivek Arya had increased PT for AMD to 44, citing increase GPU sales and recovery of the gaming GPU market and that issues of excessive inventory and crypto mining boom are over. He also upped Nvidia’s PT to 275. This is good news for AMD, since AMD is also in the game console business, as well as game streaming (with both Stadia and XCloud) and soon mobile with Samsung.

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