Intel TSMC Tentatively Agree On Chipmaking Joint Venture
Intel and Taiwan Semiconductor Manufacturing Co. (TSMC) have reached a tentative agreement to form a joint venture. According to The Information, the deal would see TSMC take a 20% stake in a new company that will manage Intel’s U.S.-based chipmaking factories. The report cites two individuals familiar with the matter.
While neither company has provided an official comment, the move comes after months of pressure from U.S. government officials. Both the White House and the Department of Commerce have reportedly urged Intel and TSMC to collaborate, aiming to address the persistent challenges Intel has faced in recent years.
This development follows an earlier pitch from TSMC to companies like Nvidia, AMD, and Broadcom, encouraging them to invest in a similar joint venture. That effort, which surfaced in March, was part of a broader U.S. push to stabilise its semiconductor supply chain by enlisting foreign expertise.
Reviving Intel’s Struggles in a Competitive Market
In an effort to turn its fortunes around, Intel appointed Lip-Bu Tan as CEO in March. A seasoned veteran in the chip industry, Tan was previously a board member. His leadership is expected to refocus Intel’s strategy after it failed to capitalise on the booming demand for AI-related chips. Meanwhile, Intel had already spent billions expanding its manufacturing capabilities, though results have been underwhelming.
Unfortunately, Intel’s attempts to manufacture chips for external clients have encountered numerous obstacles. The company struggled to match the efficiency and service quality provided by TSMC, leading to delays and unsuccessful chip tests, according to former executives. These shortcomings contributed to a net loss of $18.8 billion in 2024 — Intel’s first since 1986.
A Sign of Recovery and Strategic Expansion
Despite last year’s setbacks, Intel’s shares have shown signs of recovery in 2025, gaining nearly 12% after plummeting 60% the previous year. In contrast, the S&P 500 index rose over 23% in 2024, further highlighting Intel’s relative underperformance.
Looking ahead, TSMC appears committed to expanding its presence in the U.S. The company recently announced plans to invest $100 billion to build five additional chipmaking facilities. This large-scale investment underscores the growing strategic partnership between the two tech giants and the importance of strengthening U.S. semiconductor manufacturing.
