The production process that Intel hoped would pave the way to winning manufacturing deals and restore its edge in churning out high-end, high-margin chips is facing a big hurdle on quality as it puts newer technologies to the test.

Intel is reportedly still struggling with a chipmaking process crucial to its future. Reuters reports that the company's 18A process is still producing low yields and high defect rates. Intel has invested billions of dollars in the manufacturing process, on which it's pinned its hopes of gaining ground on TSMC.

Intel (NASDAQ:INTC) is encountering difficulties with the production yield of its latest high-performance laptop chips, according to a report by Reuters. Only a small fraction of semiconductors made using Intel’s new manufacturing technique have met the quality standards required for consumer sales.