Intel Secures UMC's 12nm Tech for Arm Chip Boost

In accordance with reports from Taiwan's Economic Daily News, it has been revealed through supply chain channels that United Microelectronics Corporation (UMC) is potentially in discussions with Intel regarding the licensing of its advanced 12nm process technology. The ongoing negotiations between the two companies are anticipated to culminate in the signing of a letter of intent for collaborative efforts in the near future. The strategic alignment of UMC's 12nm Arm architecture technology with Intel's predominant focus on the x86 architecture is expected to foster mutual benefits, with UMC slated to receive substantial licensing fees in successive phases.

UMC, as of now, has not issued an official response to the circulating rumor, underscoring the importance of the 12nm process as one of the company's pivotal developmental priorities.

Intel, having maintained leadership in the x86 architecture for an extensive period, continues to dominate the central processing unit (CPU) market. Recognizing the power consumption challenges associated with x86 architecture, Intel is exploring the potential of licensing UMC's 12nm technology, known for its low-power advantages and proficiency in the Arm architecture. In alignment with Intel's strategic focus on semiconductor manufacturing, particularly in advancing processes, the collaboration with UMC through licensing is poised to enhance Intel's commitment to technological advancement.

Intel's heightened emphasis on expanding its business footprint in Arm architecture chip manufacturing is evident through its recent collaboration with Arm for the production of chips utilizing Arm technology. Industry analysts posit that Intel's strategic move is aimed at cultivating relationships with key industry players such as Qualcomm and MediaTek, potentially positioning itself to secure orders for manufacturing chips for prominent entities, including Apple.

Beyond its endeavors in the mobile chipset market, Intel is strategically evaluating the trend of semiconductor localization in the U.S. A potential collaboration with UMC on technology transfer could serve to position Intel favorably in the context of servicing its American clientele by leveraging the proximity of semiconductor manufacturing facilities.

During its October earnings conference, UMC disclosed ongoing internal discussions concerning the feasibility of utilizing the 12nm process for the production of low-power logic products. The anticipated completion of the 12nm process by early 2025 is expected to contribute significantly to revenue growth. UMC is also considering a strategic reallocation of some of its 28/22nm production capacity to 12nm, aiming to achieve cost savings while adhering to the guiding principle of maximizing return on investment.