While Intel obviously declined to comment on these "market rumors", Digitimes.com is reporting that due to high demand, Intel is planning to outsource some of its entry-level CPU (Atom) and a part of its chipset production. This will ease some pressure on the production of other chips, especially the high-margin Xeon CPUs as well as the Intel Core consumer CPUs.
According to Digitimes' sources, Taiwan Semiconductor Manufacturing Company (TSMC) is the only capable foundry to handle such rush orders. The same sources said that Intel and TSMC have already been in talks about outsourcing since mid-2018 and it wouldn't be the first time that Intel is working with the same foundry, as the company is manufacturing Intel's FPGA series chips and has previously worked on Atom SoCs and Intel's SoFIA mobile SoCs.
Intel already announced back in October that it will invest an additional $1 billion to expand its 14nm manufacturing capabilities, which should eventually fix its supply issues, especially for those high-margin products.
Despite shortages, Intel still reported good Q3 financial results, beating its estimates and reporting a $19.2 billion revenue, with a gross margin of 64.5 percent and net income of $6.4 billion.
The shortages of consumer-oriented CPUs has already taken a toll on prices so hopefully, Intel will be able to get it under control by the first quarter of 2019.