Intel shifts Panther Lake capacity to meet Xeon demand

Intel plans to convert some Intel 18A manufacturing resources at its Oregon facilities to Intel 3 to address demand for Xeon server processors. The company disclosed the shift during its Q3 2026 earnings call. Intel 3 is the manufacturing node behind Xeon 6 ‘Granite Rapids.’

CFO Dave Zinsner said the affected Intel 18A wafers would generally have been used for Panther Lake products. Softer PC demand is allowing Intel to reallocate those resources, with the company expecting the slowdown to continue at least through the first half of next year.

CEO Lip-Bu Tan said the additional Intel 3 capacity should enter production in the second half of 2027. He described severe industry supply shortages driven by demand for Super Intelligence and said Intel had increased server supply in Q3, while acknowledging continued challenges in keeping pace with demand.