Salvaging scraps – Intel boosts revenue by selling “scrap” CPUs
High CPU demand is allowing Intel to sell “binned down” CPUs that would otherwise have been considered “scrap”
Q1 2026 has been a strong quarter for Intel. It drove revenue and margin growth, resulting in much higher earnings. Intel has already confirmed growing yield for its foundry nodes, resulting in more usable CPUs per wafer. Despite this, Intel is unable to make enough CPUs to meet demand, which is allowing it to sell CPUs that may have otherwise been considered “scrap”.
According to Ben Bajarin, a technical analyst, today’s high-demand environment is allowing Intel to sell more binned-down SKUs than normal. Customers want CPUs, and they will take what they can get. That means chips that “may have been scrap or low-expectation output” are selling, boosting Intel’s revenue.
In normal times, Intel might not be able to sell all of its binned-down chips, and lower-quality chips could be considered unsellable. Right now, demand is high, and customers would rather have a lower-binned CPU than no CPU at all. This means that Intel can earn more from its silicon wafers by selling its scraps. That’s more profit for Intel, and more CPUs to satisfy its customers.
Got some clarity from Intel IR on additional lift to margins.
Intel got an unexpected margin lift from better yield salvage. Chips that would normally have been lower-value edge-die on the wafer were binned down and still sold into usable SKUs, turning what may have been scrap…
— Ben Bajarin (@BenBajarin) April 24, 2026
Now’s a great time to be a CPU maker
If Intel can sell its scraps at a profit, its competitors are likely doing well. If Intel can effectively sell its scraps, AMD must also be supply-constrained. This high demand is already impacting the CPU market, as some models are becoming harder to find, and OEMs are struggling to get all the CPUs they need. That’s why they are willing to accept lower-end silicon from Intel. As I said before, getting a CPU is better than getting no CPUs.
As the datacenter boom continues, the high global demand for CPUs isn’t going away. If Intel is doing this well, it’s likely that AMD will also have a strong quarter. AMD is expected to report its earnings next week.
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