Intel relies on Xe3P graphics chips from its own production – a stroke of genius or a risky experiment?

Intel remains persistent despite its mixed experiences in the discrete GPU business. With the upcoming Celestial GPUs, the company not only wants to launch a new architecture, but also initiate a fundamental change in strategy: Instead of continuing to have them manufactured by TSMC, the Xe3P chips are to be created in Intel’s own foundries. A bold move that harbors both opportunities and risks.

Celestial GPUs: More promising than Battlemage or just another experiment?

After Intel’s Battlemage GPUs achieved respectable success at best – especially with budget models such as the B580 – the focus is now on the next generation. According to @OneRaichu, the Celestial GPUs should deliver a noticeable increase in performance. The foundation is the new Xe3P architecture, the design of which has allegedly been greatly optimized compared to its predecessor. So far, Intel is keeping a lid on details. A LinkedIn profile of an Intel engineer leaked the first hints about Xe3P months ago, but there have been no official announcements. However, the real surprise lies elsewhere: instead of continuing to rely on TSMC, the new GPUs are to come from Intel’s own production. A signal that Intel has apparently had enough of external dependency – at least when it comes to the dGPU division.

Intel Foundry instead of TSMC: A brave new start or a shot in the arm?

The decision to move production to its own factories could prove to be a double-edged sword. On the one hand, Intel could become more independent in the long term and save costs. On the other hand, it remains questionable whether the company’s own foundries can keep up with TSMC and Samsung – because Intel has so far been a latecomer at best in the modern manufacturing sector. The fact that Intel is still sticking to its dGPU project at least shows that the company has not yet waved the white flag. The first hints of Xe3 GPUs have already appeared in tools such as HWINFO, confirming active development. Concrete details are scarce – only a GPU with 128 EUs or 16 Xe3 cores has been spotted, probably an entry-level variant.

Timetable and competitive situation

It remains to be seen when the new Celestial GPUs will be released. Intel will probably provide more detailed information in the coming months. As Panther Lake is expected in the second half of 2025, Celestial could be launched either at the end of the year or in the first quarter of 2026. However, the real question remains: Can Intel keep up with NVIDIA and AMD? So far, the company has lacked the decisive successes needed to establish itself as a serious dGPU provider. However, if Xe3P really does make significant progress – and in-house production enables competitive prices – the tide could turn. However, if the promises remain just hot air, Celestial faces a similar fate to Alchemist and Battlemage.

A new start with an uncertain outcome

With Celestial and Xe3P, Intel is venturing into in-house production – and thus saying goodbye to TSMC, at least in this area. This shows a clear strategic reorientation, but it remains to be seen whether the foundries will prove competitive enough. The dGPU division remains a construction site for Intel. Celestial could be a decisive step towards an independent and stronger future – or another chapter in the long history of half-baked GPU experiments. The next few months will show whether Intel can actually turn things around with this maneuver or catapult itself out of business.

Source: OneRaichu via X