Apple supplier TSMC has reached a preliminary agreement with Intel that will see TSMC operating Intel’s chipmaking facilities, reports The Information. TSMC will own a 20 percent stake in the new combined company, while Intel and other semiconductor companies will own the majority of the shares.
As part of the deal, TSMC may share some of its chip manufacturing methods with Intel, and train Intel employees to use them. Discussions are still underway, and the final details have not been established. The talks between Intel and TSMC were reportedly initiated by the Trump administration in an effort to stymy Intel’s decline and bring advanced chipmaking to the U.S.
Intel is one of TSMC’s major competitors, and the two have long been rivals. Apple previously used Intel chips in its Macs, but transitioned to its own Apple silicon chips manufactured by TSMC starting in 2020. No Apple devices use Intel processors, with Apple now relying entirely on its own technology.
TSMC focuses on chip manufacturing, not design, which is handled by TSMC customers like Apple and Nvidia. The focus solely on manufacturing has allowed TSMC to outpace Intel, and Intel’s foundary operations are less attractive to companies because Intel’s chips cost more than TSMC’s and its yields are lower.
Some Intel executives are said to be worried that the deal would result in layoffs, because Intel would need to eliminate engineers and may need to change or sell the equipment that it uses. Intel and TSMC have different manufacturing machines and materials, so if Intel is expected to adopt TSMC manufacturing processes, it could have to sell most of its existing equipment.
In 2024, Intel had an $18.8 billion loss because of its investments in chip manufacturing and a weakening PC market.
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Article Link: Apple Supplier TSMC May Operate Intel’s Chipmaking Facilities
