intel considers foundry shakeup with tsmc, nvidia, and amd

2025-03-13 general

Santa Clara, Thursday, 13 March 2025.
Intel’s stock experienced a surge of over 7% following reports of a potential joint venture. TSMC has reportedly approached Nvidia, AMD, and Broadcom. The discussion involves taking stakes to manage Intel’s foundry division. TSMC would run Intel’s factories, but maintain less than 50% ownership. This move could be influenced by the Trump administration’s aim to bolster domestic AI chip manufacturing. Qualcomm has exited earlier discussions to buy all or part of Intel. Intel had a net loss of $18.8 billion in 2024.

potential joint venture details

TSMC’s proposal involves running Intel’s factories while holding less than 50% of the joint venture [1][4][8]. This structure aims to satisfy the Trump administration’s desire to keep a significant portion of Intel’s operations domestically owned [4][7]. The administration wants to revive U.S. manufacturing and strengthen domestic production [5]. TSMC seeks investors who are also customers of Intel’s advanced manufacturing services [8]. This ensures that the joint venture benefits from sustained demand and collaboration [8]

intel’s financial backdrop

Intel’s foundry business had a book value of $108 billion as of December 31, 2024 [7][8]. However, Intel has struggled, reporting its first net loss since 1986, amounting to $18.8 billion in 2024 [5][8]. Shares of Intel had lost approximately 55% of their value in the 12 months leading up to Wednesday [1]. Citi’s Christopher Danely suggests that “Intel needs to get rid of the foundry business” [8]. This highlights the pressure on Intel to restructure and improve its financial performance [8]

tsmc’s strategic investments

TSMC’s interest aligns with its broader strategy to increase its U.S. chipmaking footprint [4]. Earlier in March 2025, TSMC announced a $100 billion investment in the U.S., adding to existing developments in Arizona [4][5]. This commitment signals TSMC’s confidence in the long-term growth of the U.S. semiconductor market [4]. TSMC’s stock has experienced volatility, slipping over 15% year-to-date in 2025, but gaining more than 19% over the past year [7]. The proposed joint venture could further solidify TSMC’s position as a leading global chip manufacturer [4]

market implications and analysis

The potential Intel-TSMC partnership, involving Nvidia, AMD, and Broadcom, reflects the increasing demand for data centers and AI infrastructure [4]. Adoption of AI technology is expected to accelerate, driving further demand for advanced chip manufacturing [4]. Intel has lagged behind TSMC in capitalizing on AI-driven demand in recent years [4]. Reuters reported that Nvidia and Broadcom are testing Intel’s advanced production techniques, while AMD is evaluating adopting them [4]. This collaboration could help Intel regain its competitive edge in the semiconductor industry [4]

Bronnen

Semiconductor Industry Foundry Venture