Intel and Taiwan Semiconductor Manufacturing Co (TSMC) have reportedly reached a preliminary agreement to form a joint venture that will operate Intel's chip manufacturing plants in the United States. This development, first reported by The Information, marks a significant potential shift in the global semiconductor landscape and could signal a critical turning point in Intel’s ongoing efforts to regain its competitive edge. The report, citing two individuals directly involved in the discussions, stated that TSMC will hold a 20% stake in the newly formed venture. This strategic move is seen as a result of increasing political and economic pressure from the White House and the U.S. Department of Commerce, both of which have been lobbying hard for a resolution to the prolonged crisis at Intel.
The deal, if finalized, would bring together two titans of the chip industry in an unprecedented collaboration. TSMC, based in Taiwan, is renowned globally as the most advanced contract chip manufacturer, producing cutting-edge processors for clients like Apple, Nvidia, and AMD. Intel, on the other hand, once a dominant force in chip innovation and manufacturing, has faced years of delays, underperformance, and financial losses—most notably a staggering net loss of $18.8 billion in 2024, its first full-year loss since 1986. This downturn was largely attributed to massive asset impairments and Intel's costly investment in revitalizing its manufacturing business.
Intel’s troubles have had a massive impact on its market performance. The company’s shares lost around 60% of their value in 2024, a stark contrast to the broader tech market rally that saw the S&P 500 gain over 23% during the same period. While Intel’s stock has rebounded approximately 12% so far in 2025, the recovery is still modest compared to the broader semiconductor sector, and investor confidence remains fragile.
In March, Reuters had reported that TSMC had approached key U.S. chip clients—including Nvidia, AMD, and Broadcom—with a proposal to invest in a joint venture to manage Intel’s fabs (fabrication facilities). That initiative reportedly came at the request of the Biden administration, which has been working behind the scenes to encourage alliances that would strengthen domestic chip production and reduce America’s reliance on foreign supply chains, especially amid rising geopolitical tensions with China.
The potential Intel-TSMC deal also dovetails with TSMC’s own expansion strategy in the United States. At a press event last month, the company revealed plans to invest an additional $100 billion in U.S. operations, including the construction of five new semiconductor fabrication plants. This massive investment is being made under the umbrella of the CHIPS and Science Act, a U.S. law that provides subsidies and incentives to boost domestic semiconductor manufacturing.
Industry analysts view this joint venture as a win-win, though with some reservations. For TSMC, the deal offers a foothold in U.S. chip production infrastructure and aligns with Washington’s push for more resilient, U.S.-based supply chains. For Intel, partnering with a company like TSMC could provide much-needed technical expertise, operational efficiency, and market credibility.
However, the agreement still faces multiple hurdles. Regulatory approval, corporate governance structure, intellectual property concerns, and competitive dynamics between the companies’ client bases could complicate negotiations. Additionally, the partnership may face political scrutiny—especially from policymakers concerned about foreign influence in critical U.S. infrastructure.
While neither Intel nor TSMC has publicly confirmed the report, and the White House has not issued a statement, the news has already generated significant buzz in both financial and tech circles. If the partnership proceeds, it could reshape not just Intel’s future but also the strategic balance of the global semiconductor industry, setting a precedent for further cross-border collaborations in the face of mounting economic and geopolitical pressures.
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