TLDR
- Intel stock jumped over 7% after reports that TSMC approached Nvidia, AMD, Broadcom about forming a joint venture to run Intel’s foundry division
- TSMC would operate the foundry but own less than 50% of the joint venture
- Qualcomm has also reportedly been approached by TSMC regarding the potential deal
- The Trump administration has asked TSMC to help turn around Intel’s business
- Intel shares have lost approximately 55% of their value in the past 12 months
Intel’s stock surged more than 7% in premarket trading Wednesday following reports that Taiwan Semiconductor Manufacturing Company (TSMC) has approached several major U.S. chip designers about forming a joint venture to operate Intel’s foundry division.
According to a Reuters report citing four sources familiar with the matter, TSMC has reached out to Nvidia, Advanced Micro Devices, Broadcom, and Qualcomm about the potential partnership.
The proposed joint venture would own and run Intel’s foundry business, which manufactures custom chips for other companies.
TSMC, the world’s largest contract chipmaker, has reportedly offered to operate the foundry division while owning less than 50% of the joint venture.
The talks are still in early stages, according to the sources, with no guarantee that a deal will be reached.
This potential partnership comes at a challenging time for Intel. The company’s shares have dropped approximately 55% in value over the past 12 months.
Trump Administration Supports TSMC Aid for Struggling Chipmaker
The foundry business has recently gained attention as a possible beneficiary of the Trump administration’s goals to ensure artificial intelligence chips are both designed and manufactured within the United States.
Sources indicate that the Trump administration has specifically asked TSMC to assist in turning around Intel’s struggling business.
Intel’s foundry division, which makes custom chips for other companies, has been a focal point in discussions about U.S. semiconductor manufacturing capabilities.
The potential joint venture with TSMC and other major chip designers could provide Intel with needed expertise and investment in its manufacturing operations.
Neither Intel nor any of the other companies reportedly involved in the talks immediately responded to requests for comment.
TSMC’s approach involves bringing together several of Intel’s competitors in a unique arrangement that could reshape the semiconductor manufacturing landscape.
Joint venture could help revitalize manufacturing capabilities
If successful, this joint venture could help revitalize Intel’s manufacturing capabilities while allowing the company to benefit from the expertise of industry leaders.
The semiconductor industry has faced significant challenges in recent years, including supply chain disruptions and increasing competition in chip manufacturing.
This potential partnership reflects ongoing shifts in the global semiconductor industry as companies adjust to changing market conditions and technological demands.
The stock market’s positive reaction to the news suggests investors see potential value in restructuring Intel’s foundry operations with involvement from industry leaders like TSMC and Nvidia.
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