[News] TSMC, Broadcom Reportedly Explore Breaking Up Intel: Key Scenarios and Impacts in a Nutshell

With Trump pushing tariffs to boost U.S. chipmaking, rumors swirl about a TSMC-Intel deal. Now, Wall Street Journal and Reuters report that while TSMC eyes Intel’s foundry unit, Broadcom may join in, targeting Intel’s chip design and marketing business. Broadcom has had informal talks on pricing but may only make a bid if a partner takes Intel’s manufacturing unit, as noted in the reports. Here’s a quick summary of all the possible scenarios, and the challenges.

How Would TSMC Possibly Be Involved?

Another Economic Daily News report indicates that if Intel’s foundry does spin off, TSMC may acquire a 20% stake in the unit, either through direct investment or technology valuation, though details are undecided.

Though previous reports noted that U.S. is pushing the foundry giant and Intel to form a joint venture to co-own and develop multiple chip foundries, Reuters does not quite agree. The Trump administration supports foreign companies investing and building in the U.S., but is unlikely to approve a foreign firm running Intel’s factories, the report adds.

During TSMC’s earnings call last October, Chairman C.C. Wei dismissed speculation about acquiring Intel’s fabs, stating they are not considering it.

Other options for TSMC could include building an advanced packaging plant in the U.S. or having Intel handle future packaging orders for U.S. customers, according to previous media reports.

The Role of Broadcom and Qualcomm

The dream team may also get more players involved. According to Bloomberg, though the talks are in early stages, the deal could include major U.S. chip designers taking equity stakes.

According to the Economic Daily News, Intel’s spun-off foundry unit (IFS) would likely bring in major U.S. chip giants like Qualcomm and Broadcom to drive innovation and help Intel recover, while countering the growth of Taiwan’s IC designers such as MediaTek, as it is aggressively gaining market share in mobile and networking chips.

The Economic Daily News report adds that Qualcomm and Broadcom will invest in IFS solely for advanced chip production capacity, without involvement in fab operations.

Interestingly enough, in a December interview with the Financial Times, Broadcom CEO Hock Tan said he was not interested in buying parts of Intel, as the company’s current focus would be on shifting toward specialized AI chips.

Impact on Samsung

The rumored collaboration between TSMC and Intel, notably, could weigh heavily on Samsung. According to Korea Joongang Daily, the stronger the U.S.-Taiwan alliance, the more it harms Samsung, which lags behind in the foundry market.

There are also concerns that the Trump administration might target Samsung’s memory semiconductors next, the report adds. While the focus has been on the foundry sector, it’s expected that the U.S. will eventually extend its efforts to memory semiconductors to secure the domestic supply chain, as highlighted in the report.

According to TrendForce, TSMC led the foundry market in Q3 2024 with a 64.9% share, while Samsung was second with just 9.3%.

Read more

• [News] Shocking Yet Feasible: U.S. Reportedly Pushes TSMC-Intel Joint Venture to Boost Domestic Chipmaking
• [News] Intel’s Potential Buyers Speculated Ahead of Trump’s Inauguration: A Quick Round-up

(Photo credit: Intel)