Intel approaches TSMC for investments or partnership, WSJ reports

Global

Source: ReutersPublished: 09/26/2025, 04:45:01 EDT

Intel

TSMC

Semiconductor Manufacturing

Chip Foundry

US Government Investment

News Summary

Chipmaker Intel has approached Taiwan Semiconductor Manufacturing Company (TSMC) about investments in manufacturing or partnerships, the Wall Street Journal reported. Intel's efforts to secure outside investment began before U.S. President Donald Trump showed interest last month but have accelerated since the U.S. government took a 10% stake in the company. Intel CEO Lip-Bu Tan is actively seeking partners as part of a turnaround strategy for the struggling chipmaker. Once an industry leader, Intel has fallen behind rivals like Nvidia and AMD in the booming AI race, and its contract manufacturing business has struggled to compete with TSMC, attracting few external customers.

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Background

Intel was historically a dominant force in the global semiconductor industry, once synonymous with Silicon Valley itself. However, in recent years, the company has been surpassed by competitors like Nvidia and AMD in critical technology areas, particularly AI chips, in terms of innovation and market share. In an effort to reverse its fortunes, Intel has invested billions in establishing a contract manufacturing business, aiming to compete with pure-play foundries like TSMC. This venture has struggled to gain traction, failing to attract significant external customers and facing challenges with its process technology roadmap. In 2025, the U.S. government's focus on semiconductor supply chain security has intensified, especially in critical technology sectors. President Donald Trump's administration's expressed interest in Intel and its 10% equity stake underscore Washington's strategic imperative to secure domestic chip manufacturing capabilities and technological leadership.

In-Depth AI Insights

What are the deeper strategic motives behind Intel's pursuit of a partnership with TSMC? - While ostensibly about business turnaround, a deeper motive likely involves Intel's persistent gaps in advanced process technology, necessitating TSMC's expertise or capacity assurance. - Coupled with the U.S. government's 10% stake and President Trump's interest, this could transcend mere commercial activity, becoming part of a broader U.S. national semiconductor strategy aimed at indirectly or directly securing American control and supply chain resilience in high-end chip manufacturing through an Intel-TSMC collaboration. - This also represents a critical step for Intel CEO Lip-Bu Tan to "reinvent Intel" in the AI era, leveraging external forces to accelerate the maturity and technological advancement of its foundry business. How might the U.S. government's investment in Intel and its focus on this potential partnership reshape the global semiconductor industry landscape? - U.S. government intervention could elevate the Intel-TSMC collaboration to a national strategic level, potentially fostering a "U.S.-Taiwan" axis in semiconductor manufacturing. - Such an alliance could exert pressure on the chip manufacturing capabilities of other nations or regions and potentially escalate geopolitical tensions, especially concerning technology export controls and supply chain reorganization. - For other major foundries like Samsung, this could signify intensified competition and might prompt them to seek new strategic partnerships or market positioning. What are the potential implications for TSMC's long-term strategic autonomy and its global customer relationships if it deepens ties with Intel amidst explicit U.S. government involvement? - TSMC's success is rooted in its neutral foundry status, serving global clients. Deepening ties with Intel, especially with U.S. government backing, could raise concerns among some geopolitically sensitive customers (e.g., in Greater China), potentially leading them to seek alternatives. - This might force TSMC to make difficult choices between balancing geopolitical pressures and maintaining its global customer base. Its image of technological confidentiality and data security neutrality could be challenged. - In the long run, if TSMC's independence is compromised, it could dilute its unique position and negotiating leverage within the global semiconductor ecosystem.