Intel and TSMC reach tentative deal to form chipmaking joint venture

Intel and Taiwan Semiconductor Manufacturing Co. (TSMC) have reportedly reached a preliminary agreement to establish a joint venture aimed at revitalising Intel’s struggling U.S.-based chip manufacturing business.

According to The Information, TSMC, the world’s largest contract chipmaker, is expected to take a 20% stake in the proposed venture.

The move comes as the White House and the U.S. Commerce Department push for collaboration between the two companies to address Intel’s ongoing operational challenges. Both Intel and TSMC declined to comment on the matter, while the White House has not provided an official response.

Earlier reports indicated that TSMC had approached Nvidia, AMD, and Broadcom with proposals to invest in the joint venture at the request of the U.S. government. The initiative aims to help Intel recover from recent setbacks, including its failure to capitalise on the AI-driven semiconductor boom despite significant investments in its manufacturing capabilities.

Intel’s difficulties have been attributed to its inability to match the technical expertise and customer service standards of TSMC, resulting in delays and unsuccessful testing. The company reported a net loss of $18.8 billion in 2024, its first annual loss since 1986, driven by substantial impairments. This contributed to a 60% decline in Intel’s stock value over the year, compared to a 23% rise in the S&P 500 index.

However, Intel has shown signs of recovery in 2025, with its shares rising by nearly 12% so far. Under the leadership of newly appointed CEO Lip-Bu Tan, a seasoned semiconductor industry executive and former board member, Intel aims to reclaim its position as a leading chip manufacturer.

Meanwhile, TSMC has announced plans to invest $100 billion in the U.S., including the construction of five additional chip facilities, reflecting its commitment to strengthening its presence in the American market.