Intel's AI-GPU is a failure, Intel's Lunar Lake onboard memory is an anomaly and other news from CEO Pat Gelsinger’s latest chitchat with investors

In less than a calendar year, we reported that AMD's AI GPU sales have gone from zero to roughly the same as its combined processor sales. Intel's news isn't as good. The Gaudi 3 AI chipset is a failure.

Pat Gelsinger, Intel's CEO, said that the company will not meet its modest goal of selling $500,000,000 worth of Gaudi3 GPUs by 2024.

In order to put this into context, AMD revealed recently that it sold more than $1.5 billion worth of its MI300 AI chip in September. Nvidia, on the other hand, is likely going to surpass that $500 million figure in 2024 by a factor over 100. Gaudi 3 is a relatively new product.

Gelsinger revealed that Intel will use fully integrated memory in the Lunar Lake laptop processor, but it is a one-off.

Gelsinger said that the chip's memory on-package was a "one-off". "That won't be the case for Panther Lake, Nova Lake or its successors either. We'll build the system in a more conventional way, with the memory off-package, and the CPU, NPU, GPU and I/O abilities in the package. The road map will include volume memory as an off-package feature.

Gelsinger said that the cost was the main factor. Intel makes less money by building memory into its CPUs than without. Gelsinger also revealed something we'd been suspecting for a long time. Lunar Lake was never intended to be the successor to Meteor Lake and a major mobile model series.

"Lunar Lake had been designed as a niche product, with the goal of achieving maximum performance and battery life. Then AI PC came along." "With AI PC, it went form being a niche to a high-volume product," Gelsinger explained.

Gelsinger also confirmed that Intel will reduce the amount TSMC silicon used in its CPUs during the next few product cycle. Gelsinger stated that "the majority of Panther Lake's wafer capacity is coming back to Intel." Nova Lake, there are definitely some SKUs we're considering leveraging externally. However, the majority of Nova Lake and the additional tiles has been brought back in-house.

There was no mention of Intel's Battlemage graphics. Intel has frequently mentioned Battlemage, which is supposedly the successor to Intel's original Arc gaming graphics. We originally expected it earlier in the year. Gelsinger has studiously ignored it again. It seems unlikely that new graphics card based on Battlemage will appear this year.

It's a shame, because Battlemage now has to fight against the next-generation RTX GPUs from Nvidia and AMD, both of which will be released early next year. This will only make Intel's job harder.

Gelsinger did not mention gaming graphics at all, but instead he emphasized Intel's x86 processors. "We continue to concentrate on our core x86 business and the ecosystems that we have built over the past 40 years of investment," he said. "We are taking steps to supercharge our x86 brand and unlock its value."