Intel: Sorry for PC chip delays, but we just can't meet demand for CPUs

In an extremely rare move, Intel has published a letter from a senior exec apologizing to customers and partners for ongoing delays in shipping its CPUs.

The letter was signed by Intel executive vice president and GM of sales, marketing and communications, Michelle Johnston Holthaus. 

"I'd like to acknowledge and sincerely apologize for the impact recent PC CPU shipment delays are having on your business and to thank you for your continued partnership," she wrote. 

SEE: Digital transformation: A CXO's guide (ZDNet special report) | Download the report as a PDF (TechRepublic)

Intel flagged the letter as part of its supply update notice. "Although Intel is working hard to regain supply-demand balance, it remains a challenge," it said. 

Holthaus said despite investments and best efforts to meet demand, Intel had not yet resolved the challenge. 

She said Intel had "invested record levels of capex" (capital expenditure) on boosting its 14nm wafer capacity at the same time as ramping up 10nm production. Intel unveiled its 10nm Ice Lake chips in May.  

Per AnandTech, Intel warned investors in April that shortages would continue, despite its $1.5bn investment last year to boost 14nm fab output. In response, the chip giant prioritized manufacturing of high-end Xeon and Core i7/i9 over cheaper chips from its Atom, Celeron, and Pentium lines.

Holthaus said besides the 14nm investments it was also "increasing our use of foundries to enable Intel's differentiated manufacturing to produce more Intel CPU products".

SEE: Intel's Koduri continues a GPU computing revolution he helped start years ago

Naturally, she painted Intel's predicament as both good and bad news for the company in an era when PC shipments have been in sustained decline, with the exception of a recent bump due to the Windows 10 refresh cycle.  

"The added capacity allowed us to increase our second-half PC CPU supply by double digits compared with the first half of this year," wrote Holthaus. 

"However, sustained market growth in 2019 has outpaced our efforts and exceeded third-party forecasts. Supply remains extremely tight in our PC business where we are operating with limited inventory buffers."

More on Intel

• Intel's Koduri continues a GPU computing revolution he helped start years ago
• Intel to remove old drivers and BIOS updates from its site by the end of the week
• Intel Xe GPUs are here with Ponte Vecchio launched at SC19
• Intel warning: Critical flaw in BMC firmware affects a ton of server products
• Intel unveils next-gen Movidius VPU, codenamed Keem Bay
• Intel's Cascade Lake CPUs impacted by new Zombieload v2 attack
• Top Linux developer on Intel chip security problems: 'They're not going away.'
• The desktop is dead, and Intel's NUC killed it: AMD to build a SFF PC kit TechRepublic
• Intel's AI brains will give future laptops a new speed boost CNET