[News] Intel Flags CPU Shortages on Intel 10 and 7 Nodes as Demand Outpaces Supply Into 2026

In its first earnings report since the Trump administration acquired a 10% stake, Intel reported a return to profitability, noting that demand for some of its older process chips remains strong. According to CRN, the company also cautioned that CPU shortages could persist well into next year as demand continues to outpace supply.

In its press release, Intel CFO Dave Zinsner said third-quarter revenue reached $13.7 billion, exceeding the high end of guidance and rising 6% sequentially. He noted that capacity constraints, particularly on Intel 10 and Intel 7, limited the company’s ability to fully meet demand for data center and client products during the quarter.

Further addressing the outlook for demand outpacing supply into 2026, Zinsner said Intel expects shortages to peak in the first quarter next year, explaining that after managing Q3 and Q4 with limited inventory, “we’re going to be really, really tight in Q1,” according to a transcript from Investing.com.

Zinsner added that shortages extend across much of the business, with capacity especially tight on Intel 10 and Intel 7. He noted that Intel does not plan to expand capacity for those nodes, meaning constraints will persist as demand rises. To mitigate the impact, the company is redirecting customer demand to alternative products. Zinsner also pointed to broader industry issues, such as substrate shortages, which are compounding the supply challenge, as indicated by the earnings call transcript from Investing.com.

AI PC Adoption Slower Than Expected as Users Favor Older Chips

Regarding AI PC sales, which appear to be progressing more slowly compared with the strong demand for older-node processors, Zinsner said that sales of Intel’s AI products rose by double digits quarter over quarter. He added that the company expects to ship around 100 million AI PC units by the end of this year and is actively working to help the broader ecosystem develop more applications for AI in the PC market.

Zinsner also noted that the Windows refresh is unfolding more strongly than the company had anticipated. According to CRN, despite Intel and other firms promoting AI PCs powered by newer processors such as Lunar Lake as an upgrade path to Windows 11, many users are instead choosing to upgrade using less advanced hardware.

As noted by CRN, products built on the Intel 10 and Intel 7 nodes include the 14th-generation Core “Raptor Lake Refresh” and 5th-generation Xeon Scalable “Emerald Rapids” series, both launched in 2023. CRN also mentions that newer products such as the Core Ultra 200V “Lunar Lake” and Core Ultra Series 2 “Arrow Lake” lineups rely fully or nearly fully on TSMC for production.

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(Photo credit: Intel)