Hardware

"I think the big thing that's influencing margins next year is Lunar Lake. We have Lunar Lake, which is largely fabbed outside. There is a component of it that is fabbed inside. It's got memory in the package and we're just a pass through, couldn't get good deal on memory. So that suppresses the margins. And depending on how that product goes, it's kind of a headwind to us on the gross margin front," he explained.

Looking ahead, Zinsner said this will change. "Panther Lake is an 18A, or has an 18A component in it. So we start to see wafers come back. So we'll see this memory thing go away. We'll see more wafers going internal. We'll do better in terms of our cash cost per wafer. So that should be a nice tailwind for gross margins for us," he claimed.

(ignoring the memory aspect) Wasn't part of the point of decoupling design and manufacturing to make it not really matter 1) where the design team is doing manufacturing (pick the best one whether it's theirs or not) and 2) what designs the manufacturing team is producing? If they're so happy to get the manufacturing done in-house anyway, that seems contradictory to the overall strategy of splitting the two halves apart?