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Following an unprecedented boom during the pandemic as consumers and businesses snapped up PCs, the bottom fell out of the PC market last year. Global PC unit shipments plunged 16.2% in 2022, according to Gartner. The beginning of this year has been no better. Shipments crashed 30% year over year in the first quarter.

There have been two problems plaguing the PC market. First, demand has declined. PC upgrades that would have been occurring now were pulled forward by the pandemic. People who frantically bought a new laptop in 2020 because they were working from home have little incentive to upgrade now.

Second, this drop in demand created a surplus in inventories, both PCs and some components. Intel (NASDAQ: INTC) and rival Advanced Micro Devices have been selling PC CPUs at a rate well below end-market demand in recent quarters because customers have prioritized working through existing inventories of chips.

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Semiconductor-giant Intel (NASDAQ: INTC) is focused on regaining its manufacturing lead over TSMC while building out a foundry business of its own. The company is in the process of bringing five new advanced manufacturing nodes to volume production within a span of four years. That effort will culminate with the Intel 20A and Intel 18A processes, both expected to be ready by the end of 2024.

These new cutting-edge processes will be necessary for Intel to convince chip designers to use its foundry to manufacture ultra-fast, ultra-efficient chips that power smartphones and other devices. But there are other types of chips that don’t benefit from the latest and greatest manufacturing process. Instead, they need a mature, inexpensive process that can deliver adequate performance and efficiency while keeping costs down.

That’s where Intel’s “Intel 16” manufacturing process comes in. Intel 16 is a rejiggered version of a mature node that Intel began using back in 2018, optimized for low-cost and low-power chips. MediaTek, which designs a wide variety of chips that go into 2 billion devices each year, announced a partnership with Intel last year that aimed to bring some of those chips over to Intel’s foundry using the Intel 16 process.

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The Worst Is Over for Intel's PC Business

Intel's Foundry Business Takes Another Step Forward