TSMC to Acquire 20% Stake in Intel's Wafer Foundry
Recent reports from foreign media and supply chain sources suggest that TSMC is considering acquiring a 20% stake in Intel's newly spun-off wafer foundry division, Intel Foundry Services (IFS). This stake could be obtained either through technology-based valuation or direct investment. The move would see Qualcomm, Broadcom, and other major US semiconductor companies investing in IFS, aiming to foster innovation, boost collaboration, and support Intel's recovery while enhancing its competitiveness against MediaTek, which has been gaining market share from US companies.
In response to the speculation, neither Qualcomm nor Intel has commented, and TSMC has declined to address the rumors. As of the latest reports, Broadcom has also not provided a statement. The Wall Street Journal has reported that the Trump administration has requested TSMC to evaluate the possibility of controlling part or all of Intel's wafer manufacturing operations, potentially through an investor group or other structural arrangement.
Sources indicate that the US government's primary goal is to strengthen domestic semiconductor production and increase Intel's wafer manufacturing capacity, with TSMC's involvement seen as a means to boost "Made in America" efforts. The current focus is on securing a 20% stake in IFS, though the exact form of investment and related financial details remain under discussion.
Qualcomm and Broadcom's investments in IFS would not involve direct operational control of the foundry, but rather a "capacity acquisition" approach, ensuring access to advanced manufacturing processes to meet their own production needs. The aim is to enhance the utilization of IFS's facilities while supporting US-based manufacturing, with the added intention of countering MediaTek's growing influence in the mobile and networking chip markets, particularly as it takes market share from US companies.
Last week, US President Donald Trump expressed frustration with Taiwan's increasing share of the US chip business, stating, "If the business isn't brought back to the US, we will be very unhappy." Analysts note that in the semiconductor industry, TSMC holds a dominant position as the world's leading foundry. MediaTek has recently overtaken Qualcomm in smartphone chip shipments and is rapidly gaining ground in Wi-Fi chips, challenging Broadcom's position in the networking space and capturing more of the US market.
Intel has previously signaled its intent to compete for Qualcomm's advanced process orders, with Qualcomm confirmed as a customer for Intel's 20A process. However, despite a lack of further details, the US government's ambitions to bolster Intel's foundry operations and secure ample advanced process capacity for US-based IC designers are clear. This strategic focus not only aims to capture some of TSMC's foundry business but also to solidify the position of US-based IC design companies in the global market.
Qualcomm and Broadcom's investments in IFS reflect a broader strategy to counterbalance MediaTek's dominance and restore US companies' leadership in mobile chip shipments. The move also aims to safeguard the US market from further losses to MediaTek and other Taiwanese competitors.
Sources further indicate that TSMC and Broadcom are separately evaluating potential deals with Intel, with TSMC reportedly interested in acquiring partial or full control of Intel's wafer manufacturing operations, while Broadcom is focusing on Intel's chip design and marketing business. Broadcom has been in informal discussions with advisors about making an offer, but any formal bid would likely depend on securing a partnership to manage Intel's wafer fabrication business.
Intel's interim chairman, Frank Yeary, is leading discussions with potential acquirers and US government officials. Intel has already started separating its chip manufacturing division from its other business units, which some analysts believe could be a step toward a future business split.
