Intel will be producing custom chips, designed by Microsoft for Microsoft

Microsoft is doubling down on its efforts in making its own infrastructure to run AI tasks to not only boost the performance of its systems but also cut down costs by reducing the dependency on third-party chip providers like Nvidia. As a part of this strategy, the Windows maker announced two custom-designed chips, and it has now collaborated with Intel that will be producing those custom chips.
Microsoft plans to use Intel’s 18A manufacturing technology to make a forthcoming chip that the software maker designed in-house, the two companies said at an event.
Intel 18A is the company’s most advanced semiconductor manufacturing process that is set to begin manufacturing in the latter half of 2024. As per Intel, this technology will be used to produce a future consumer Lake CPU and a future data centre CPU. It offers increased power and efficiency.
While Intel did not specify which chips it will produce, at Ignite 2023, Microsoft unveiled the Microsoft Azure Maia 100 AI Accelerator, optimised for artificial intelligence (AI) tasks and generative AI, and the Microsoft Azure Cobalt CPU, an Arm-based processor to run general purpose compute workloads on the Microsoft Cloud.
What Intel, Micorosft CEOs have to say
Intel CEO Pat Gelsinger said that customers are supporting Intel’s long-term systems foundry approach and as per the company, Intel leaders expect Intel will regain process leadership with Intel 18A in 2025. The announcement was made at Intel’s first foundry event, Intel Foundry Direct Connect, in which the participants and speakers included Microsoft CEO Satya Nadella and OpenAI CEO Sam Altman.
Nadella stated that Microsoft has chosen a chip design it plans to produce on the Intel 18A process.
“We are in the midst of a very exciting platform shift that will fundamentally transform productivity for every individual organisation and the entire industry,” Nadella said.
“To achieve this vision, we need a reliable supply of the most advanced, high-performance and high-quality semiconductors. That’s why we are so excited to work with Intel Foundry, and why we have chosen a chip design that we plan to produce on Intel 18A process,” he added.
With this, Intel follows competitor Taiwan Semiconductor Manufacturing Company (TSMC), which has partnerships with companies like Apple, Qualcomm and AMD.