Intel announced on Thursday that it is pushing back the rollout of its 7nm chips by six months relative to previously-planned release date.
In an earnings call on Thursday, Intel CEO Bob Swan said that a 'defect mode' in the 7nm process is causing the 'yield degradation' in the chip manufacturing process.
"The company's 7nm-based CPU product timing is shifting approximately six months relative to prior expectations," Intel said in a press release [pdf].
The announcement means Intel's 7nm CPUs will not arrive in the markets until late 2022 or early 2023.
But, the good news is that Intel is confident of fixing the issue, and believes that "there are no fundamental roadblocks".
Swan also said that the firm has learned many lessons from 10nm development process, and it is now also investing in contingency plans to make up for the delay in 7nm rollout.
According to Swan, those contingency plans include using external third-party foundries to manufacture some specific chips in the future.
The announcement from Intel comes after Apple recently revealed its plan to rely on its own chips for future devices.
Intel's competitors like AMD and Nvidia have already started taking advantage of 7nm technology to produce more efficient chips.
AMD has been manufacturing its own Ryzen 4000 chips based on 7nm architecture for months.
In the meantime, Intel will continue to use its 10nm processors, where it is ramping up production after years of delays.
Intel's 10nm technology was scheduled to appear in 2017, but it only now making it into high-volume production.
"Intel is accelerating its transition to 10nm products this year with increasing volumes and strong demand for an expanding line up," the company said.
"This includes a growing portfolio of 10nm-based Intel Core processors with 'Tiger Lake' launching soon, and the first 10nm-based server CPU 'Ice Lake', which remains planned for the end of this year."
Next year, Intel expects to roll out a new line of client CPU's (Alder Lake), which will include its first 10nm-based desktop CPU. A new 10nm-based server CPU (Sapphire Rapids) will also be delivered in the second half of the year, the firm said.
Intel also posted encouraging financial results for the second quarter on Thursday. Revenue for Intel's Client Computing Group increased to $9.50 billion, up 7 per cent from Q2 last year.
Intel's overall revenue for Q2 also increased to $19.7 billion, up 20 per cent year-over-year, mostly driven by robust growth in Intel's data centre and memory solutions divisions.
The chip maker is also rumoured to have made major breakthrough in 2nm chips
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