Intel CEO Lip-Bu Tan confirmed that the next-generation Nova Lake desktop processors will be the first client product to use the company's enhanced 18A-P manufacturing node, with further details to be shared at CES in January. The announcement came during Intel's Q3 2026 earnings call, where executives also said the company intends to take Panther Lake capacity offline to produce more Granite Rapids data center chips and warned of a significant contraction in the PC market.
The 18A-P node, which entered risk production in June, offers a 9% speed improvement at the same power or an 18% power reduction at the same speed compared to the base 18A node. Intel has described 18A-P as a drop-in replacement, allowing designs built for 18A to use the enhanced node without extra engineering work. At Hot Chips in August, Intel revealed that its next-generation Xeon 7 Diamond Rapids would be the first server product to use the node.
"Nova Lake, our first Intel 18A-P client product, is tracking ahead of schedule, with design wins expecting to be twice those of Panther Lake at launch," Tan said in prepared remarks. Speculation regarding whether Nova Lake would use Intel's 18A node or TSMC's N2P has swirled; current industry speculation suggests the chip will use 18A-P for the SoC tile and TSMC's N2P for the compute tile, though Intel did not confirm those details.
Intel CFO David Zinsner warned of a sustained contraction in the PC market. "We expect the 2026 PC unit [Total Addressable Market] to decline approximately 12%, with second half units down more than 20%. We do not expect a sustained recovery until memory availability improves and pricing begins to normalize," Zinsner said. For 2027, Intel is planning a further decline of roughly 10%. Zinsner also said Intel expects its client business to decline by more than 20% in the next quarter. The article linked the expected market decline to memory prices and a pullback in spending by OEMs and IT departments.
Despite the near-term outlook, Zinsner expressed optimism. He said Intel sees a "market-share-gain type of environment" going forward and thinks the PC will go through a "renaissance" despite memory shortages. Tan said Intel's OEM partners are "aggressively managing inventory to match softer sell-through."
Zinsner said Intel plans to take some client capacity offline. "What we're taking offline to put Intel 3 into Oregon is 18A wafers, which were generally going to build Panther Lake products, so we see the opportunity with some of that capacity freed up to go produce more data center wafers," he said. The company intends to use capacity freed up from Panther Lake production to build more Granite Rapids data center CPUs.
Intel's Wildcat Lake products, which use the 18A node, are seeing strong demand. Tan said demand for Wildcat Lake is outstripping supply. Intel reported that 18A products now make up a third of client CPU revenue, up from less than 5% in the first quarter.
Analysis
Why This Matters
- Intel's decision to shift client wafer capacity to data center chips signals a strategic pivot away from a shrinking PC market, potentially affecting availability of consumer processors.
- The confirmation of 18A-P for Nova Lake provides clarity on Intel's desktop roadmap and is a key test for its manufacturing turnaround.
- A sustained PC market contraction, driven by memory prices, could raise costs for consumers and slow enterprise refresh cycles.
Background
Intel's 18A and enhanced 18A-P nodes represent the company's push to regain manufacturing leadership after years of delays. The nodes support both its own products and external foundry customers. Nova Lake is Intel's next major desktop CPU family after Panther Lake, and its first client chip to use the advanced 18A-P process.
What to Watch
- CES in January for detailed Nova Lake architecture, product specifications, and launch timing.
- Memory price trends: Zinsner cited memory availability as the key to a PC market recovery.
- Intel's ability to balance client and data center production while maintaining market share in a shrinking market.
Checked
12 claims in this story checked against 1 source: 12 supported.
Show each claim
- SupportedNova Lake will be Intel’s first client product to use the 18A-P node.Latest from Tom's Hardware: “Intel's next-gen Nova Lake desktop processors will be the first client product to use Intel's enhanced 18A-P node, CEO Lip-Bu Tan confirmed”
- SupportedIntel said it would share more about Nova Lake at CES in January.Latest from Tom's Hardware: “We look forward to sharing more at CES in January.”
- SupportedTan said Nova Lake was ahead of schedule and expected to have twice as many design wins as Panther Lake at launch.Latest from Tom's Hardware: “"Nova Lake, our first Intel 18A-P client product, is tracking ahead of schedule, with design wins expecting to be twice those of Panther Lake at launch," Tan said in his prepared remarks.”
- SupportedIntel plans to take Panther Lake capacity offline to build more Granite Rapids data center CPUs.Latest from Tom's Hardware: “The company's chief financial officer shared that Intel intends to take Panther Lake capacity offline to build more Granite Rapids data center CPUs.”
- SupportedTan said the capacity being taken offline was 18A wafers generally intended for Panther Lake, which could be used to produce more data center wafers.Latest from Tom's Hardware: “What we're taking offline to put Intel 3 into Oregon is 18A wafers, which were generally going to build Panther Lake products, so we see the opportunity with some of that capacity freed up to go produce more data center wafers.”
- SupportedZinsner forecast 2026 PC unit TAM would decline approximately 12%, with second-half units down more than 20%.Latest from Tom's Hardware: “We expect the 2026 PC unit [Total Addressable Market] to decline approximately 12%, with second half units down more than 20%.”
- SupportedIntel is planning for PC unit TAM to decline roughly 10% in 2027.Latest from Tom's Hardware: “For 2027, we're planning a PC unit TAM to decline roughly 10%.”
- SupportedIntel expects its client business to decline by more than 20% in the next quarter.Latest from Tom's Hardware: “Intel's David Zinsner said the company expects the company's client business to decline by "more than 20%" in the next quarter.”
- SupportedZinsner said Intel sees a market-share-gain environment and expects the PC to go through a renaissance despite memory shortages.Latest from Tom's Hardware: “We think next year, and in future years, we're a market-share-gain type of environment... we do think the PC is going to through a renaissance despite [memory shortage]”
- SupportedTan said Intel's OEM partners were aggressively managing inventory to match softer sell-through.Latest from Tom's Hardware: “Tan said that Intel's OEM partners are "aggressively managing inventory to match softer sell-through,"”
- SupportedCompared with 18A, 18A-P offers 9% faster speed at the same power or 18% lower power at the same speed.Latest from Tom's Hardware: “18A-P comes with a 9% improvement in speed at iso-power, or an 18% reduction in power at iso-speed.”
- Supported18A products make up a third of client CPU revenue, up from less than 5% in Q1.Latest from Tom's Hardware: “Intel says that 18A products now make up a third of client CPU revenue, up from less than 5% in Q1.”
