This article first appeared on GuruFocus.
Intel (NASDAQ:INTC) stock slipped about 2% on early Wednesday after reports indicated that Nvidia (NASDAQ:NVDA) chose not to use Intel’s 18A manufacturing process.
The two companies had tested the process earlier this year, but Nvidia reportedly decided against moving forward. Broadcom (NASDAQ:AVGO) also took part in similar trials.
Intel’s 18A technology is part of its effort to attract external chipmakers as customers, but early evaluations faced technical challenges, which may be affecting demand.
Shares of Nvidia remained mostly steady, suggesting minimal immediate impact on its production plans.
The company continues to rely heavily on Taiwan Semiconductor Manufacturing Company (TSM) for advanced chip fabrication.
For Intel, the decision underscores the competitive hurdles in winning high-profile foundry clients while trying to scale its advanced manufacturing capabilities.