IBM has confirmed its PowerPC G5 CPU yield issues, which was noted in Apple’s financial results conference call eariler this week as the reason for the delays in the Xserve G5s:
“The Microelectronics Division has been in the red for some time. During a conference call with analysts, John Joyce, senior vice president and chief financial officer for IBM, said the former technology unit lost $150 million on a pro forma basis in the first quarter of 2004 alone,” Mark LaPedus reports for Silicon Strategies.
“One of the problems is ongoing yield issues within the company’s 300-mm fab in East Fishkill, N.Y. For months, IBM has been struggling with yields in the fab, a 130- and 90-nm plant,” LaPedus reports. “‘We do see demand, but we need to make the products,’ Joyce said. ‘”We need to improve our yields in our 300-mm plant. Our yields did see some improvement, but not as fast (as the company had hoped).'”
LaPedus reports, “IBM is seeing better-than-expected yields within its 200-mm plant in Burlington, Vt., he said. But profits within the 200-mm fab did not offset ongoing losses within the 300-mm fab and a sudden drop in IP revenues in the first quarter, he said. Joyce believes the technology unit will become profitable in 2004, due to increased chip demand, improving yields and flat IP sales.”
Full article here. (Attribution: MacNN)