Intel chips cost $40 to make - report | The Register

Intel chips cost $40 to make - report | The Register
It's not hard to see how Intel makes its money. According to market watcher In-Stat, the chip giant's average cost per die is a mere $40 - significantly less than it the prices it attaches to its processors.

That figure, the researcher calculates, has remained consistent over the past two years and will continue through 2005. This despite rising fab and materials costs.

In part, Intel has been able to maintain the cost per die by moving to 300mm wafers and by aggressively adopting new, smaller fabrication processes. According to In-Stat, Intel leads the market in manufacturing process development and fab capacity. It noted the chip giant will have four 65nm fabs ramping up output volumes next year. By contrast, AMD has a single 65nm fab, currently in development. The Dresden, Germany plant is its only facility capable of handling 300mm wafers.

Still, AMD is broadening its capacity through foundry deals - Chartered Semiconductor will also be pumping out 65nm, 64-bit AMD processors - and, more importantly perhaps, working with other chip vendors to develop future process technologies and this spread the cost.