Intel's Crucial Panther Lake Chips Start Production

To say that Panther Lake, Intel's (NASDAQ: INTC) upcoming family of laptop CPUs, is an important product would be a vast understatement. Not only is Panther Lake an opportunity for Intel to win back market share lost to AMD over the past few years, but it's also a showcase for the expensive game of catch-up the company has been playing in manufacturing.

Panther Lake is the first product to use the Intel 18A process, which Intel is also attempting to sell to third-party foundry customers. The company hasn't had much luck so far on that front. Intel 18A has yet to land a major external customer order, and rumors circulated over the summer that new Intel Chief Executive Officer (CEO) Lip-Bu Tan was considering refocusing on the next-generation Intel 14A process instead.

While the ship may have sailed for landing customers on Intel 18A for cutting-edge chips, the process was meant to have a long life and could potentially win customers down the road for chips that don't require the latest and greatest technology. If Panther Lake succeeds as a product, it would provide some reassurance to potential foundry customers that Intel is a viable option.

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Production has officially begun

While Intel 18A was ready for production earlier this year, production of Intel's Panther Lake chips has now officially started. The company expects to reach high-volume production in Arizona by the end of the year in preparation for broad availability in January.

The Intel 18A process brings two important changes, compared to Intel's older manufacturing processes. First, Intel 18A uses the new RibbonFET transistor architecture, which will deliver improved performance and efficiency over the style of transistor the company has been using for more than a decade. Second, the Intel 18A process is the first in the industry to use backside power delivery, which moves power circuitry to the backside of the chip. While this feature makes manufacturing more complex, it delivers meaningful gains in energy efficiency.

Intel's last two families of laptop CPUs, Lunar Lake and Arrow Lake, were aimed at different segments of the PC market. Lunar Lake was focused on energy efficiency, with integrated memory and incredible battery life, while Arrow Lake was more focused on performance. Intel is claiming that the Intel 18A process will enable Panther Lake to deliver the efficiency of Lunar Lake and the performance of Arrow Lake.

Panther Lake is also getting a CPU core upgrade. Both the performance cores and the efficient cores are as much as 50% more performant than Intel's last-generation chips.

Part of that comes from the Intel 18A process, while part comes from architectural changes. Graphics performance should also be about 50% faster, and the chips will provide up to 180 trillions (or tera) operations per second (TOPs) of AI performance. For comparison, Lunar Lake shipped with 48 TOPs.

A must-win situation for Intel

After years of so-so product launches, Intel needs to hit a home run with Panther Lake. Lunar Lake was a solid but niche product, while Arrow Lake was performant but not all that efficient. AMD's products have improved dramatically over the past decade, so the competition is stiff. Panther Lake has all the ingredients to be a big winner for Intel.

A successful Panther Lake launch could also help the foundry business by convincing potential customers that the Intel 18A process is the real deal. The big hurdle for Intel in the foundry business is trust and confidence, and Panther Lake could be the showcase Intel needs to finally win a major customer.

Intel stock has soared recently after investment deals with the U.S. government, Softbank, and Nvidia. However, for those gains to hold, the Intel 18A process and Panther Lake both need to deliver.

Timothy Green has positions in Intel. The Motley Fool has positions in and recommends Advanced Micro Devices, Intel, and Nvidia. The Motley Fool recommends the following options: short November 2025 $21 puts on Intel. The Motley Fool has a disclosure policy.