Intel will design, package, and fabricate Fortinet's sixth-generation Security Processor (SP6) on its Intel 4 node, the companies announced on July 21, giving the process its first named external foundry customer, roughly three years after it entered production. Intel told Tom's Hardware the agreement reflects "the strategy Intel outlined for Intel 4 several years ago," including support for custom networking ASIC workloads. Intel's own record from those years reads differently, however, with the company's 2021 roadmap having scoped Intel 4 to two internal products. And through 2022, it told engineers and investors that Intel 3, not Intel 4, would be its first process offered to foundry customers.

Intel 4's record

Intel's Accelerated announcement back in July 2021 said that Intel 4 would reach production readiness in the second half of 2022 for products shipping in 2023, naming "Meteor Lake for client and Granite Rapids for the data center." The release and its accompanying fact sheet, however, contained no reference to foundry customers, networking, or custom ASICs on the node.

At VLSI 2022, Intel disclosed that it wasn't building a high-density library for Intel 4 and that Intel 3 would be the first new node offered through what was then Intel Foundry Services. A 2024 post on Intel's own foundry blog describes Intel 3 as "Intel Foundry's first leading-edge process node," and Intel's fiscal year 2024 annual report listed the processes available to external customers as 18A, Intel 3, Intel 7, Intel 16, and a 12nm node co-developed with UMC. Intel 4 appears nowhere on that list.

Ericsson's RAN Compute processors, announced in November 2023, were built on Intel 4, so Fortinet's part won't be the first third-party silicon to come off the node. That work grew out of a bespoke Intel-Ericsson collaboration, though, and Ericsson's formal foundry agreement with Intel, announced in July 2023, covered 18A. Fortinet is the first named customer buying Intel 4 as a foundry service, and the first cybersecurity vendor on any Intel node. The Ericsson engagement is also the closest thing in the public record to networking silicon on Intel 4, two years after the strategy Intel now says it outlined for the node.

Fab 34 economics

Intel 4 entered high-volume manufacturing at Fab 34 in Leixlip, Ireland, in September 2023, producing the compute tile for Meteor Lake-based Core Ultra chips, and shares the fab with Intel 3. Intel sold a 49% stake in the facility to Apollo-managed funds for $11.2 billion in June 2024, then bought it back in April 2026 for $14.2 billion, funded with $7.7 billion in cash and $6.5 billion in new debt. That buyback returned 100% of Fab 34's wafer economics to Intel at a premium of roughly 27%, and it only pays off if the fab's EUV capacity stays loaded.

Meteor Lake is aging out of Intel's lineup as 18A-based Panther Lake ramps through 2026, which leaves open the question of what fills Intel 4 capacity next. A multi-generation firewall ASIC program is a reasonable answer with mature yields, a customer that values supply stability over bleeding-edge density, and a part Intel described as tailored for cost-sensitive applications. Intel said in April that yields were improving across Intel 4, Intel 3, and 18A.

Fortinet's supply chain

Fortinet's 2025 annual report names Renesas and Toshiba America as the contract manufacturers for its ASICs, utilizing foundries in Taiwan and Japan operated either by TSMC or by the contract manufacturers themselves. The current SP5, a monolithic 7nm Arm-based SoC announced in February 2023, sits in that supply chain, so SP6 on Intel 4 moves Fortinet's next flagship security processor out of a TSMC-linked flow and into Intel's. The disaggregated design language in the announcement points to a chiplet-based part, a first for Fortinet's SP line.

Fortinet re-engineered three FortiGate models in 2022, the 70F, 600F, and 3700F, to accept alternative components during the chip shortage, and CMO John Maddison told SDxCentral at the time that the company wouldn't wait for parts to arrive in 2023. The "resilient and diversified" supply chain used in the SP6 press tracks back to that experience. Ken Xie called Fortinet "the #1 firewall leader with a 55% unit market share" in the company's 2025 results in February, with approximately six million FortiGates deployed, so there’s real, substantial volume here even if the parts are relatively inexpensive.

Intel Foundry reported $307 million in external revenue for 2025, up from $159 million the year before, against total foundry revenue of $17.8 billion and an operating loss of $10.3 billion. External revenue in Q1 2026 was $174 million. Fortinet's hardware business runs at roughly 30% of its revenue, and, per analysis from ServeTheHome, SP6 is ultimately a component of a portion of an annual hardware stream around $2 billion, so the deal won't move Intel's foundry line materially, even at full production.

CEO Lip-Bu Tan told CNBC in May that he expected commitments from multiple foundry customers in the second half of 2026, and Intel told investors in January that two prospective customers were evaluating 14A test chips. The SP6 announcement comes inside Tan's stated window, and it finally gives Intel something its foundry marketing has lacked in a named customer with shipping volume on a node with mature yields. Meanwhile, an 18A or 14A commitment from a major external customer is still missing, and Fortinet's cost-sensitive parts on a 2023 node don't substitute for one.

All three leading-edge foundries — Intel Foundry, Samsung Foundry, and TSMC — have initiated mass production of chips using 2nm-class process technology. Samsung was the first one to start production using its SF2 node (though it could be argued that this is a rebadged SF3P) around mid-2025, Intel followed suit with its 18A node in November (albeit at development lines in Oregon, not production lines in Arizona), and TSMC initiated high-volume manufacturing using its N2 process at two volume fabs in Taiwan in December. We outline what's next for these three leading-edge foundries.

The current state of the market

The amount of capital, expertise, and experience required to develop leading-edge process technologies and build high-volume fabs supporting advanced nodes is so high that only three companies in the world are currently capable of producing them. Companies like Rapidus have yet to prove they are a viable leading-edge chipmaker. Meanwhile, all three leading foundries are transitioning from traditional node scaling to a more segmented, architecture- and product-driven approach, but are doing so with different priorities.

TSMC is focused on predictable scaling, combined with aggressive specialization, which is why its roadmap is split into high-performance computing-oriented technologies with backside power delivery network (BSPDN) and cost/density-optimized nodes without it.

Samsung has a wide range of node variants, though it is currently more focused on yield improvement, rather than on scaling, which is why its roadmap appears more iterative than breakthrough-focused. This is perhaps why it is behind competitors with its BSPDN implementation.

Intel seems to be pursuing the most aggressive technological roadmap with a conjoined implementation of gate-all-around (GAA) RibbonFET transistors and PowerVia BSPDN, rapid iteration, and the aggressive pursuit of High-NA EUV lithography in 2027 – 2028, years before its rivals.

Intel Foundry: The most ambitious chipmaker

Being a new player in the foundry market and a large integrated design manufacturer (IDM), Intel is pursuing a multi-faceted strategy aimed at addressing the needs of its own products, as well as attempting to land customers that do not necessarily require leading-edge process technologies.

Intel's roadmap is the most ambitious, but arguably the most volatile one, when compared to the plans of other leading foundries. On the one hand, Intel needs the best fabrication technologies to differentiate its own consumer and data center products. To that end, with its 18A and subsequent process technologies, Intel bet on the simultaneous implementation of GAA transistors and a BSPDN to maximize performance, power efficiency, and transistor density. On the other hand, since Intel has zero customers from the automotive and smartphone sectors, it does not have any technologies tailored specifically for these applications.

Intel's 18A is probably the most important technology for the company in years, as it will return production of the company's consumer CPUs back to its own fabs, something that promises to greatly improve margins. Although the company is in the process of improving yields on 18A and current 18A volumes are not significant, Intel is already preparing follow-on refinements such as 18A-P (with enhanced performance and improved power efficiency) and 18A-PT (which supports through silicon vias (TSVs) and can be used for 3D-integrated systems-in-package).

Beyond that, Intel is targeting 14A and 14A-E for 2027 ~ 2028 production readiness and an early ramp. The nodes will introduce Intel's 2^nd Generation RibbonFET GAA transistors, revamped PowerDirect backside power delivery, and Turbo Cells to improve the performance of critical data paths.

These will be the company's first nodes to use High-NA EUV lithography, at least for some 14A and 14A-E variants, which will be another attempt to introduce a technology that will differentiate Intel compared to competing nodes. Intel has said that the interest in 14A from external customers is significant. Musk's Terafab project is set to make use of Intel's 14A, as a licensee, but not as a customer.

At the same time, Intel is heavily relying on node variants to address different use cases, including performance enhancements (P), feature enhancements (E), and through-silicon via support (T). These process technologies are required to enable Intel to build custom multi-chiplet products for consumer and data center applications, which directly support its strategy to produce most of its products at in-house fabs.

Intel's roadmap also includes continued investment in mature nodes such as Intel 16 and UMC 12 as the company pursues a strategy to capture demand outside leading-edge applications, to ensure steady revenue streams.

While Intel's plans are aggressive and ambitious, the abrupt cancellation of 20A in late 2024 highlights the execution risks associated with such a roadmap.

Samsung Foundry: When yields matter more than nodes

Samsung was the first company to adopt GAA transistors with its SF3E technology in 2022, three years before Intel and TSMC. However, low and unpredictable yields have limited the adoption of this technology to niche applications like cryptocurrency mining ASICs. While SF3 was more mature, it was still adopted by select applications, mostly internally. As a result, the highest-performing chips made by Samsung are produced using FinFET-based SF4P and SF4X, which puts the company behind its rivals.

For now, reducing defect density, increasing yields, and ensuring stable yields are the top priorities for Samsung. Last year, it began making mobile system-on-chips (SoCs) using its SF2 node (which it calls the 1^st Generation 2nm GAA process), but among the major goals for the company for this year is to ramp up '2^nd Generation 2nm [SF2P] and prepare performance and power-optimized 4nm process,' which suggests limited adoption of SF2. The fact that the low-power 4nm-class node will be a major workhorse for the company. The company's roadmap also indicates SF2X (HPC-oriented) in 2026 as well as SF2A (for automotive applications) and SF2Z (SF2X with BSPDN) in 2027, though we can only wonder whether these nodes will be widely adopted.

Nonetheless, Samsung's iterative approach to the evolution of its SF2 nodes (SF2=>SF2P=>SF2X=>SF2X with backside power) is evident, which gives us hope that the company's yields will gradually improve.

Samsung's next major node will be SF1.4, a 1.4nm-class process technology optimized for consumer and smartphone applications, which won't feature backside power delivery. Samsung's slides put SF1.4 above the SF3 and SF2 families, which may suggest that this manufacturing process will feature some major enhancements, such as a new GAA transistor design or other major refinements. Samsung expects to mass-produce chips on its SF1.4 technology in 2027, so it can formally leave Intel and TSMC behind with its 1.4nm node.

A big question lingers, and that's whether Samsung plans to finally start using pellicles with its EUV lithography tools starting with SF1.4, or later. A lack of pellicles greatly increases the number of potentially yield-killing stochastic mask-borne defects, which are increasingly dominant at the 2nm and are getting much worse at thinner nodes.

TSMC: New technologies like clockwork

TSMC's roadmap remains the most structured and execution-focused among the three. The world's largest contract chipmaker initiated mass production of chips using its N2 process technology — its first node with GAA nanosheet transistors — at two fabs simultaneously late last year in a bid to meet demand from a wide range of applications, starting from Apple's smartphones and all the way to AMD's server-bound EPYC 'Venice' CPUs. Initiating volume production at two fabs simultaneously is something that rarely happens in the industry, though it looks like structural changes caused by demand from the AI segment are changing many things in the industry.

TSMC is on track to start making chips using performance-enhanced N2P with traditional frontside power delivery and A16 technology that adds backside power delivery on top, a split which highlights TSMC's increasingly segment-specific approach to leading-edge technologies.

Going forward, the company is set to continue offering advanced technologies with and without BSPDN, as this feature may be too expensive for consumer and smartphone applications, but is clearly valuable for heavy-duty data center processors. For example, A14 will emerge as a smartphone-oriented node in 2028, but then will re-emerge as a data center-oriented node once it gets BSPDN in 2029.

In addition, the company will continue to offer mainstream nodes like N4C, N3C, and eventually N2C for applications that are more sensitive to costs. Automotive-specific nodes (N7A, N5A, N3A) will lag leading-edge nodes by one to two generations, as they prioritize reliability and longevity over performance and transistor density.

TSMC's segmentation and yearly cadence for advanced manufacturing nodes enable the foundry to address the most demanding clients like Apple, AMD, Intel, Nvidia, or Qualcomm with competitive process technologies. Ultimately, such cadence and a wide range of nodes reinforce TSMC's position as the most predictable and commercially disciplined foundry.

Fractured futures

To sum things up, TSMC continues to bet on execution discipline and segmentation as it ramps its 2nm-class node at two fabs to meet overwhelming demand from a variety of applications, starting from humble cell phones all the way to heavy-duty servers.

Intel leads in architectural ambitions, as currently it is the only company that uses a process technology that features both gate-all-around transistors and backside power delivery. However, the company admits that its yields will only get to world-class level by 2027, which likely makes Intel's 18A node significantly less attractive to demanding customers.

Samsung sits somewhere in the middle, offering a wide variety of process technologies for different applications, but the company's yields with GAA-based nodes have been a challenge, which is why the firm is now focused on yield increases rather than on breakthroughs, so it does not attempt to leapfrog its competitors.

Intel this week announced that Shawn 'Seung Hoon' Han will join the company as senior vice president and general manager of Foundry Services, where he will be responsible for working with external customers. Shawn Han will join the company from Samsung Foundry, where he had similar responsibilities, and will bring decades of valuable experience at a contract chipmaker, something that Intel Foundry needs these days.

"I am excited to welcome Shawn Han to our leadership team," wrote Naga Chandrasekaran, executive vice president and the head of Intel Foundry, in a LinkedIn post. "Shawn will be joining us in May as senior vice president and general manager of Foundry Services, reporting to me. Shawn brings valuable expertise in the semiconductor industry from his three decades at Samsung, including most recently overseeing sales at Samsung Foundry. He also offers impressive technical acumen from his work on multiple logic process nodes beginning in 1996."

As the head of Foundry Services — a structure within Intel Foundry responsible for working with customers in general and external customers specifically — Shawn Han will be responsible for sales and customer relations, which includes landing external customers. More recently, Shawn Han served as executive vice president of Samsung Foundry, which he joined from Samsung Semiconductor in 2021.

Shawn Han will become the highest-ranking executive focused on foundry customer engagement that Intel has hired to date. While the company has traditionally hired leaders focused on product or process technology development, Han has spent the last five years specifically on customer-facing roles.

The hire indicates that Intel Foundry understands its next bottleneck is not just process technology, but customer acquisition, trust, and long-term relationships. While Intel Foundry may have a great value and technology proposition with 18A, 14A, EMIB, and Foveros, external foundry customers do not sign multi-year deals because the node deck looks good, but because they believe Intel Foundry can behave like a real contract chipmaker offering predictable PDKs, realistic timelines, predictable yields, sufficient capacity, and responsive support. Hiring someone who has already lived in a customer-centric foundry world is a good way to achieve that trust and relationships with customers. At the end of the day, Intel yet has to persuade its potential customers that Intel Foundry can offer the same discipline, neutrality, and customer obsession that pure-play foundries have in their blood.

The timing of the hire seems to be right, too. Intel has been trying to land customers with its 18A, 18A-P,14A nodes, and advanced packaging for a while now, and while the company continues to say that the interest towards its process technology is high, interest is not the same thing as booked wafer volume. Therefore, one of Han's main tasks will be converting technical curiosity into committed business.

For sure, Shawn Han's knowledge of potential customers' needs as well as his personal relationships with Samsung Foundry customers will be added bonuses to Intel's Foundry Services. Kevin O'Buckley, the previous head of Foundry Services, left for Qualcomm in late February.

Intel and Apollo on Wednesday said that they signed an agreement under which Intel would repurchase a 49% stake in the Ireland Fab 34 joint venture it sold in 2024 for $14.2 billion. Under the terms of the agreement, Intel will regain full control over its fab, which will positively impact margins of Intel Foundry, whereas Apollo will get a $3 billion premium over the original transaction.

Intel plans to finance the buyback of the 49% joint venture stake using a combination of existing cash reserves and roughly $6.5 billion raised through new debt issuance. The company expects the deal to have a positive impact on its ongoing earnings per share, because by taking over a 49% stake of a fully ramped fab, it will not have to pay margins to Apollo when it gets wafers from Fab 32. As an added bonus, Intel expects the deal to improve its credit ratings starting in 2027 and beyond.

Back on June 4, 2024, Intel and Apollo inked an agreement under which Intel converted of its Fab 34 near Leixlip, Ireland, into a separate venture and then sold 49% of this venture to Apollo for $11.2 billion. The move aimed to inject much needed cash into Intel to enable it to keep equipping its Fab 34 in Ireland and invest in other facilities, including Fab 52 in Arizona. Fab 34 was meant to manufacture wafers using Intel 4 and Intel 3 process technologies and the output was sold to Intel under a cost-plus-margin model. Additionally, Intel committed to minimum purchase volumes, which ensured predictable utilization and revenue streams for the JV.

The structure of the deal effectively separated the economics of Fab 34 from Intel Foundry's financial performance, making the JV profitable while deepening losses for Intel Foundry. Intel was also obligated to complete the build-out of Fab 34, which further lowered execution risk for the minority investor. Meanwhile, Intel got money to equip its Fab 52 in time for production of Panther Lake and Clearwater Forest processors. Fab 52 is fab from being ramped up, but the company seems to be optimistic about its ramp.

Intel Fab 34 began high-volume manufacturing of compute chiplets for Meteor Lake processors in September, 2023. As a result, by mid-2024, Fab 34 was decently (but not fully) ramped and was ready to produce compute dies for client-oriented Core Ultra 'Meteor Lake' and data center-oriented Xeon 6 'Granite Rapids' CPUs. By now, the fab has produced chiplets for millions of CPUs and hundreds of thousands of wafers using Intel's 3nm- and 4nm-class process technologies.

In general, Apollo's investment resembled infrastructure-like capital deployment, with stable, bond-like cash flows rather than full participation in the risks associated with leading-edge semiconductor manufacturing. Apollo's position in the JV offered no operational control or strategic influence, so its ability to improve performance/utilization/profitability of the fab beyond the predefined framework was limited. Meanwhile, the 49% stake clearly limited its earnings to less than 50% below what any fab could deliver, so holding this stake meant little sense for the company.

From a financial standpoint, the exit terms are quite good: Intel agreed to repurchase Apollo's 49% stake for $14.2 billion, which is a roughly 27% nominal gain over a relatively short holding period of less than two years. As a result, Apollo seems to be happy with the transaction and is ready to work with Intel in the future.

"Flexibility and alignment are core to how we approach relationships as a long-term, solutions-oriented capital partner, and we are pleased to facilitate this transaction in support of Intel's evolving strategic and operational priorities," said Apollo Partner Jamshid Ehsani. "This mutually beneficial transaction is a testament to how we operate: client-driven and focused on long-term partnership. We are proud to support Intel’s evolving strategic and operational priorities and look forward to pursuing additional opportunities to work together over time."

TSMC's average selling prices (ASPs) for its wafers have increased 15.9% annually from 2019 to 2025. Additionally, gross profit margins per wafer rose rapidly to 3.3x throughout 2025, according to SemiAnalysis. This increased margin reflects TSMC fully leveraging its market-leading position and broad ecosystem to command higher product pricing, which in turn drives downstream effects, including higher end-product pricing. The increases come after a decade during which TSMC earned minimal profit, keeping pricing low as it cornered the market and expanded its market share.

The new era of extreme ultraviolet (EUV) chipmaking began in 2019, with TSMC positioned as the top contract chipmaker. Equipped with robust production capacity and an ecosystem of partners leveraging this new technology, TSMC has seen significant ASP growth. The company is expected to maintain this momentum into 2026 and beyond, driven by several factors.

The rise of TSMC

Since its inception in 1987, through to the 2010s, TSMC was considered a leading foundry, but not a leading chipmaker. At the time, Intel was the undisputed champion of the semiconductor industry, with microelectronics pioneers like IBM also remaining competitive. However, TSMC has been consistently expanding its ecosystem over the years. In 2008, the company established its Open Innovation Platform (OIP) program — uniting TSMC with chip designers, IP providers, and EDA tool developers — essentially setting the stage for its current success.

Things changed suddenly for TSMC in the mid-2010s, when Apple outsourced production of its chips to TSMC, departing from Samsung, which had since become a significant rival to Apple in the smartphone segment. For Apple, going with TSMC guaranteed no IP theft and no plans to compete in the smartphone segment. TSMC also offered a continually evolving roadmap of process technologies and capacity availability, which, among other things, persuaded Apple to back TSMC.

Landing orders from the world's largest manufacturers of consumer electronics (including Huawei, Sony, and Panasonic) gave TSMC the financial capacity required to invest in R&D and new tools to produce chips for customers at high volumes. With Intel's hiccups with its 10nm fabrication process, TSMC entered 2019 with all of the factors needed to become a market leader.

The company was offering services that no other chipmaker could match, bagging big-name customers like Apple, Huawei, and Nvidia in the process. This offered TSMC not only informal recognition of leadership but also the financial resources to expand its turf.

Expensive tools? Even more expensive chips

As a result, after more than a decade of stagnation, TSMC's wafer pricing model fundamentally changed in 2019, as it had to buy, deploy, and depreciate ASML's Twinscan NXE tools, which cost around $235 million each. While these tools from ASML were less expensive in 2019, they steadily increased in price, as the machines became more advanced.

Since TSMC had no real competition, and an increase in the costs of machinery, these factors set the stage for market dominance. Paired with the massive OIP infrastructure, TSMC managed to expand gross profit per wafer by roughly 3.3x throughout 2025, based on data from SemiAnalysis. The report claims that quotes are rising at a far faster pace than production costs, which sets a new economic baseline for leading-edge foundry manufacturing.

EUV revolutionizes fab industry

From 2005 to 2019, TSMC's wafer ASPs remained largely flat because leading-edge foundry capacity was still relatively elastic due to competition, according to SemiAnalysis. Over those 15 years, ASPs increased by only $32 per wafer, with an annual growth rate of approximately 0.1%. Process nodes advanced rapidly using DUV lithography, so capital intensity increased gradually (i.e., in accordance with the growth of customer requirements) rather than exponentially.

During this period, the company largely operated under a cost-pass-through model, using modest pricing adjustments to offset rising manufacturing expenses. This approach limited margin expansion even as process complexity increased. Consequently, market conditions dictated wafer pricing, rather than the capital requirements of foundries.

However, customer economics limited this value-based pricing. Leading-edge demand was dominated by smartphones and consumer SoCs with tightly constrained bill-of-materials (BOM) targets, and no ballooning AI or HPC segment was generating massive gross margins. Yield learning curves were rapid; performance-per-watt gains were predictable; tool and mask costs were rising at a pace that allowed rivals to follow TSMC with capacity and competitive nodes; and there was no structural shortage of production capacity.

As a result, TSMC, just like other foundries, prioritized utilization, scale, and long-term ecosystem dominance over margin expansion. This strategy kept ASP growth near zero until TSMC began to adopt EUV for high-volume manufacturing, forcing their hand and intensifying capital expenditures. These factors coincided with the beginning of the AI and HPC megatrends we've observed in recent years.

In the six years that followed, wafer ASPs at TSMC rose by approximately 133%, equivalent to a 15.2% compound annual growth rate, while the cost of goods sold increased by only 78%. As a result, TSMC's gross profit per wafer increased sharply. Regression analysis made by SemiAnalysis illustrates the shift clearly: before 2019, every $1 increase in cost of goods sold (COGS) translated into $1.43 in ASP, yielding $0.43 in incremental profit; after 2019, the same $1 cost increase generated $2.31 in ASP, or more than $1.30 in incremental profit.

As noted above, the inflection coincided with the industry's transition to EUV-based process technologies, which dramatically altered supply dynamics, as TSMC became the only viable choice for big companies. While Samsung began using EUV tools for HVM in 2018, it used them only for its own chips, primarily due to tool scarcity and yield constraints.

The use of EUV tools at TSMC increased capital intensity and slowed capacity expansion, as EUV systems are physically larger than older DUV scanners and place their light source beneath the tool, making the addition of leading-edge output even more difficult. As a result, advanced-node wafers ceased to be interchangeable commodities and became capacity-constrained assets for tens of competing high-tech giants.

This allowed TSMC to price its output well above incremental cost without eroding demand. AI and HPC processors produced for customers like AMD, Broadcom, Google, Intel, or Nvidia carry significantly higher margins than legacy mobile or consumer chips. As a result, TSMC anchors pricing to customer value rather than manufacturing expense, which highlights the post-2019 divergence between ASP growth and COGS inflation.

In fact, big customers like AMD, Broadcom, Nvidia, and Marvell are willing to pay TSMC extra to lock in production capacity with the best process technologies to produce AI accelerators.

Advanced packaging further strengthened TSMC's position. By integrating leading-edge logic with sophisticated packaging technologies, the company increased customer lock-in and raised barriers for competitors. Notably, rising wafer costs now work in TSMC’s favor by discouraging new entrants and widening the competitive moat, rather than compressing margins as they did in earlier eras.

A new foundry model

The data published by SemiAnalysis indicates that TSMC has transitioned from a traditional foundry model focused on scale, utilization, and cost recovery to one defined by systematic undersupply, extreme capital intensity, and value-based pricing.

Leading-edge wafers are no longer commodities that can be obtained from multiple sources, but constrained assets required by trillion-dollar corporations. Given the current situation, pricing is increasingly anchored in the economic value delivered to customers rather than in incremental manufacturing costs. As a result, TSMC is thriving, and it will continue to do so until a viable challenger emerges. Neither Intel Foundry nor Samsung Foundry can currently compete against TSMC's leading-edge production capabilities, at least not yet.

It should be noted that TSMC's pricing power did not appear overnight. It emerged after decades of sustained capital investment, consistent yield leadership across successive nodes, and the gradual consolidation of the industry's most valuable supplier onto a single chip development and manufacturing platform under the OIP brand. Also, TSMC has attracted most of the world's leading chip designers, including Intel, which has its own manufacturing capacities.

These factors created both technical and economic lock-in, resulting in rising costs that reinforce competitive barriers rather than shrinking margins. This highlights a fundamental reality of advanced semiconductor manufacturing in general: TSMC's lasting pricing power has emerged from long-term structural investments along with stable performance increases and yields, and cannot be replicated in the short term.

Intel is in the early stages of talks with AMD about making the fabless chip designer an Intel Foundry customer, according to a report from Semafor.

The report, citing "people familiar with the matter," doesn't say just how much of AMD's chip manufacturing would move to Intel. The company currently fabs its chips at TSMC. (Intel fabs some products at TSMC, too.)

In the past several weeks, Intel has seen a flurry of activity and investments. The United States announced a 9.9% ownership stake in Intel, while Softbank bought $2 billion worth of shares. Alongside Nvidia, Intel announced new x86 chips using Nvidia graphics technology, with the graphics giant also purchasing $5 billion in Intel shares. There have also been reports that Intel and Apple have been exploring ways to work together.

Such a partnership with AMD could validate former Intel CEO Pat Gelsinger's vision. He had previously expressed interest in building chips for all of the world's major tech companies, including long-time rival AMD. It's unknown if AMD is considering a stock purchase similar to Nvidia.

AMD would be a major get for Intel, the latter of which has talked to many companies in a search for foundry customers. Current Intel CEO Lip-Bu Tan has suggested the company could stop offering its 18A node entirely if there isn't enough demand for it.

Intel and AMD did not respond to requests for comment from Tom's Hardware in time for publication.

It makes sense for Intel's former rivals — especially American companies — to consider coming to the table. The White House is pushing for 50% of chips bound for America to be built domestically, and tariffs on chips aren't off the table. Additionally, doing business with Intel could make the US government, Intel's largest shareholder, happy, which can be good for business. AMD faced export restrictions on its GPUs earlier this year as the US attempted to throttle China's AI business.

In general, Intel's Foundry technology is perceived as less advanced than TSMC's, but partnering with Intel could provide a backup if AMD ever needs one.

In recent months, we heard numerous rumors about Intel's alleged plans to spin off its Intel Foundry manufacturing arm and then sell a significant stake to potential customers, or the U.S. government's supposed intention to force Intel to spin off Intel Foundry and then make TSMC buy a 49% stake in Intel's U.S. manufacturing operations. None of this has materialized, and it's possible that it never will. However, at a recent industry event, Intel's Chief Financial Officer said that the company could theoretically sell up to a 49% stake in Intel Foundry without running into issues with the U.S. government. However, given that Intel does not own 100% of Intel Foundry's assets, would it make financial sense to spin off or IPO Intel Foundry?

"The structure of the government financing is that they also got warrants associated with Intel stock, it triggers off [if we sell] below or selling more than 50% of the business," said David Zinsner, the CFO of Intel, at Citi's 2025 Global TMT Conference. "I think, as long as we hold 51% essentially it does not trigger, and it is a five-year warrant. […] Our motivation will probably be not to sell below 51% because that would dilute investors significantly. Unless it made economic sense for investors for us to do that. So, the likelihood is, if we are selling stakes in Foundry, it would be something less than 49% that would be sold off."

Keeping Intel Foundry an American foundry

According to Intel's contract agreement with the U.S. government, under which Intel converted its grants into cash in exchange for equity, the company must control at least 51% of Intel Foundry over the next five years or risk triggering punitive clauses (a 5% warrant at $20/share). The same terms applied to Intel's grants under the CHIPS and Science Act, so the company was obliged to maintain a majority ownership stake in its Intel Foundry for some time.

From the U.S. government's point of view, by holding the majority, Intel keeps the foundry business aligned with U.S. national security and reshoring goals and ensures domestic fab capacity remains under the control of a U.S. company, which is particularly important given geopolitical risks (i.e., China–Taiwan tensions).

However, requiring Intel to retain majority ownership (over 51%) of its Intel Foundry unit significantly disrupts the possibility of a full spin-off — at least in the next five years. A true spin-off would typically mean Intel divests its foundry operations into a separate, independent company with its own ownership and governance (as AMD did with GlobalFoundries in 2009). But a 51% requirement constrains this, capping how much capital Intel can raise from outside investors, which may be needed to stay competitive with TSMC, Samsung, or emerging Chinese foundries.

Semiconductor Co-Investment Program (SCIP)

While for now Intel controls and operates all of its semiconductor production capacities in the U.S., Ireland, and Israel, as well as packaging facilities in the U.S., Puerto Rico, Malaysia, and China, it should be noted that Intel does not completely own all of its fabs.

Back in 2022, Intel kicked off its Semiconductor Co-Investment Program (SCIP) arrangement, under which it attracted investors (and essentially raised $26 billion) without violating the CHIPS Act requirement or the U.S. government’s 51% ownership clause tied to a potential Intel Foundry spin-off.

However, this means that Intel lost 100% control of its advanced fabs. As a result, Intel's leading-edge Fab 52 and Fab 62, located in the Ocotillo campus in Arizona, are co-owned by Intel (51%) and Brookfield Infrastructure (49%). The company's Fab 34 in Ireland is also owned by Intel (51%) and Apollo Global Management (49%).

These arrangements under the SCIP program are not a spin-off, but asset-level co-financing structures, so the foundry unit stays inside Intel. Intel still owns and operates the fabs, but splits the capital investment with partners like Brookfield Infrastructure and Apollo Global Management. In each case, Intel retains exactly 51% equity and operational control, meaning it does not breach the U.S. government's ownership clause for CHIPS funding or equity conversion.

In theory, if Intel decides to start building out its Silicon Heartland site in Ohio in the coming years (not sometime in the 2030s), then it can use the same SCIP program to raise the necessary capital and build new capacity without requiring a spin-off or IPO and without violating the contract with the U.S. government.

IPO is still a possibility

The U.S. government is considering a plan to purchase a stake in Intel in a bid to speed up completion of the company's delayed semiconductor complex in Ohio, reports Bloomberg, citing sources familiar with the matter. If the plan comes to fruition, this could become a crucial instrument to put Intel in the foundry game with the right process technologies and enough capacity. The idea reportedly emerged after the meeting between President Donald Trump and Intel's chief executive, Lip-Bu Tan, earlier this week. 

None of the parties has formally confirmed the plan, so take the information with a grain of salt. 

The idea centers on providing Intel with additional financial support to advance its manufacturing site, once called Silicon Heartland in Ohio, which was once promoted as one of the largest chip production sites in the world, once it is fully built and equipped. Construction has been repeatedly postponed, and the latest timeline pushed mass production of chips in Ohio into the next decade.

Speeding up completion of the fab would be crucial for Intel's foundry initiative, which requires ample production capacity, as well as U.S. national security, as the company and its partners will be able to produce chips on its most advanced fabrication process domestically. 

Israeli news source Calcalist has reported that Intel Israel has initiated legal action against Natalia Avtsin, a former employee, and Yafim Tsibolevsky, a previous component supplier, for their alleged conspiracy to embezzle over NIS 3 million, approximately $842,000. This embezzlement allegedly took place between October 2023 and November 2024, remaining undetected until Intel exposed the fraud.

Avtsin was employed in Intel Israel's hardware production department until her dismissal in November 2024. Intel stated that her termination was part of a strategy to reduce operations in Israel and was unrelated to her alleged crimes, which were still undiscovered at that time. In September 2023, Tsibolevsky registered as an authorized dealer under the name "Energy Electronics 2000" and subsequently became an official Intel supplier the following month.

Avtsin and Tsibolevsky's operation began with Avtsin asking Tsibolevsky for price quotes on hardware components. Avtsin then sent the quotes to her manager for approval, but supposedly altered the transaction classification afterward. She is said to have changed the classification from "components" to "services," which bypasses essential verification protocols. Logically, only an insider could know how a reclassification can easily bypass many security checks.

Intel Israel informed Calcalist that payments for services were less strict compared to payments for components. For service payments, a signed delivery note or confirmation receipt was not required. With no verification barriers, Tsibolevsky could submit invoices and receive payments at his convenience.

If the purchase had been classified as "services," Tsibolevsky would not have escaped scrutiny, as Energy Electronics 2000 failed to register with Intel for service provision. To evade detection, Tsibolevsky issued invoices of $20,000 or less, aligning with Avtsin's transaction limit. Once more, Tsibolevsky would have likely been unaware of this information without an insider's involvement.

Intel Israel's investigation suggests possible third-party involvement. It appears that certain transactions were processed through Levanon Kogan, a company providing purchasing services to firms that are not registered with Intel. The chipmaker has not accused Levanon Kogan of any misdemeanor, but these activities appear to correlate with the scheme of Avtsin and Tsibolevsky.

In certain operations, Avtsin obtained a quote from Tsibolevsky and requested Levanon Kogan to make payments to him. Like with other fraudulent schemes, she allegedly reclassified these transactions from components to services. Intel found that as many as 30 counterfeit orders were processed via Levanon Kogan, amounting to over NIS 2 million, or approximately $561,000.

Intel is suing Avtsin and Tsibolevsky in the Haifa District Court, asking the defendants to repay the stolen funds and any profits they made from them.

Currently, Intel's Foundry division loses billions every quarter as it invests heavily in new process technologies and production capacity. However, the company hopes that the Intel Foundry unit will break even sometime in 2027, which will coincide with the rollout out Intel's 14A manufacturing technology and production start on 18A-P node. 

Intel this week reaffirmed that the first product made on its 18A (1.8nm-class) fabrication process, the client PC processor (codenamed Panther Lake), will hit the market late this year and will ramp next year. The manufacturing technology will also be adopted for Xeon 'Clearwater Forest' and some third-party products, but from Intel's Foundry business perspective, 18A is will be a proof-of-concept for external clients. If this production node is a success, more potential customers will adopt its successors, including 18A-P, and 14A (1.4nm-class). 

"I think we do need to see more external volume come from 14A versus versus 18A, said David Zinsner, chief financial officer of Intel, at the J.P. Morgan Global Technology, Media and Communications Conference. "We have […] a bunch of bunch of potential customers, and then we get test chips, and then some customers fall out in the test chips, and then there is a certain amount of customers that kind of hang in there. So, committed volume is not significant right now, for sure. But, you know, I think we have got to partly prove ourselves a little bit with our own product and eat our own dog food here, and then […] we start to see some engagement around customers." 

Zinsner admitted that if the company choses to use High-NA EUV lithography with its 14A process technology — as it plans to at the moment — its costs will go up initially. Intel hopes that advantages enabled by the new fab tools will outweigh those higher costs. 

Intel explained the rationale behind its High-NA EUV strategy at its Intel Foundry Direct 2025 conference this week. Despite persistent questions around cost-effectiveness, Intel has championed its use of the new High-NA EUV chipmaking tool with its forthcoming 14A process. However, Intel has not yet fully committed to using the new tool in production, but it has an alternative production flow of its 14A node that uses standard Low-NA EUV as a backup plan.

Intel has already received a second high-NA EUV tool, installed in its Oregon fab, and the company says the technology is progressing well. However, due to continuing development, the ~$400 million ASML Twinscan NXE:5000 High-NA EUV machines haven’t been used in a production environment yet, so Intel isn’t taking any risks.

“[..]The first one is, Intel still has the option to have either a Low-NA or a High-NA solution on our 14A technology, and its design-rule compatible, there will be no impact to the customers, depending on the path that we choose. Second, High-NA EUV is performing to the expectations, and we will introduce it at the right time," said Dr. Naga Chandrasekaran, EVP, CTOO & GM of Intel Foundry Technology and Manufacturing.

"We already have data on 18A as well as 14A that shows yield parity between our Low-NA-based solution and a High-NA-based solution. So, we are continuing to make progress on the technology front and ensuring that we have the right options available for us to make sure the solution we deliver to our customers has the lowest risk and the best reward in terms of the decisions we make,” Naga explained.

Intel will only use High-NA EUV on a small number of layers of the 14A node (the exact number isn’t known), while other machines of varying resolutions will be used for the other layers. That means the decision between the two machines will only impact a select portion of the manufacturing process, but Intel says using triple-patterning with a Low-NA EUV (more below) machine instead of High-NA produces the same results.

Because both techniques are design-rule compatible, Intel’s customers won’t have to change their designs regardless of the company’s decision on the final manufacturing flow, either with or without High-NA EUV, which helps defray concerns that customers might have with Intel embracing an as-yet unproven production technology.

Additionally, Intel’s claim that both production flows offer the same yields signals that there won’t be severe time-to-market repercussions if High-NA EUV development hits a snag, or if Intel chooses not to deploy it due to economics. Employing multipatterning often reduces yields, but Intel's claim of yield parity speaks to the advances of modern multipatterning, particularly in the field of overlay technology.

Most of the public-facing conversations about High-NA EUV have centered around cost, there's plenty of industry speculation that High-NA isn't as cost-effective as multi-patterning with Low-NA EUV, but there are still numerous technological hurdles to bringing the machines into production. Most of the challenges center around the universe of complementary technologies required to make High-NA viable, like resists, photomasks, and computational lithography, among others, which have to be optimized for the new machines.

However, Intel adopted ASML's machine first to get a leg up on the competition, and it has already produced 30,000 wafers using High-NA lithography during the development phase. As a representative explained later in the event, Intel still sees significant cost savings due to eliminating around 40 process steps.

“Finally, I want to talk about High-NA EUV. Why do we do this? It's very simple; It's lower cost. In the middle picture, you see a pattern that has been generated by a single pass High-NA EUV and a pitch that is comparable to the pitch that we need for 14A. The right-hand side shows a very similar pattern generated with a traditional approach, where we use three EUV exposures [triple patterning], and overall about 40 process steps to generate this pattern."

"So, overall, we see much shorter, simpler flow, and this is the type of application where we use High-NA in 14A, which reduces the cost compared to the multi-pass 0.33 NA EUV [Low-NA]. Additionally, this provides the option to de-populate the metal layers and get additional performance enhancement.”

Intel didn't specify whether or not its comparisons are based on a full-reticle-sized print. High-NA can only print half of a reticle at a time, requiring two prints to create one reticle-sized processor and relying upon stitching to bring the two prints together into a single cohesive unit. In contrast, die that are equal to or smaller than a half-reticle size will only require one print with High-NA EUV. In contrast, Low-NA EUV machines can process a full reticle-sized die in a single print.

Thoughts

Intel has plenty of scar tissue from its 10nm node failures that ultimately ended in the company losing its chipmaking lead over TSMC, and it chalks the 10nm issues up to making too many big bets on new manufacturing techniques and technologies at once.

The decision to develop an alternative Low-NA production flow is designed to prevent repeating those past mistakes, and Intel has also de-risked other types of advances by developing alternative solutions in the past.

For instance, the company developed its new backside power delivery system with the 18A node, an industry first, while simultaneously developing gate-all-around (GAA) transistors, a first for Intel. To ensure a backup plan, the company employed a more robust de-risking strategy with its 20A process that included developing an internal-only trial process node without gate-all-around transistors. However, development went well with both GAA and backside power delivery, so Intel pushed forward with the full version of the node.

Intel rival TSMC has confirmed it will not use High-NA with its competing A14 node, and it hasn't indicated when it will employ the new High-NA EUV tool in volume production. Intel had originally planned to use High-NA with its 18A process, which arrives before the 14A node. Intel later changed those plans, saying that the process node's unexpectedly fast development meant the machines wouldn't be ready in time.

Intel is testing a new way to tackle the growing heat output of its power hungry chips. At its recent Foundry Direct Connect event, the company showcased an experimental package-level water cooling solution designed to more efficiently cool CPUs . Intel has working prototypes for both LGA (Land Grid Array) and BGA (Ball Grid Array) CPUs, with demos using Intel’s Core Ultra as well as Xeon server processors.

The cooling solution doesn’t apply coolant directly to the silicon die. Instead, a specially designed compact cooling block sits atop the package, featuring microchannels made of copper that precisely guide the coolant flow. These channels can be optimized to target specific hotspots on the die, potentially improving heat removal where it matters the most.

Intel claims the system can dissipate up to 1,000 watts of heat using standard liquid cooling fluid. That kind of thermal load isn’t typical for consumer CPUs, but it could be relevant for high-end AI (Artificial Intelligence) workloads, HPC (High Performance Computing), and workstation applications.

Intel made a slew of announcements at its Intel Foundry Direct 2025 event in San Jose, California, and finally shared performance metrics for its upcoming 14A process node, slated for risk production in 2027, touting headline improvements of up to a 35% reduction in power consumption. Intel also teased its new Turbo Cell technology, a customizable design approach geared to provide maximum CPU frequency and to boost performance for critical speed paths in GPUs.

The 14A and 14A-E nodes are the next generation after the company's 18A node. Intel says 14A will deliver a 15 to 20% performance-per-watt increase over 18A, which can be leveraged as either higher clock speeds or 25-35% lower power consumption at the same performance, depending upon chip-specific tuning. Much of this improvement is due to Intel's new direct-contact backside power delivery network, which the company has dubbed PowerDirect (more here).

Intel has also sprinkled in other new features to improve the node, such as a wider threshold voltage (Vt) range that enables a more expansive voltage/frequency curve.

The 14A nodes also deliver a 1.3X increase in transistor density over the 18A node. Intel has also revamped its RibbonFET transistors for 14A, now known as 'RibbonFET 2.' Intel hasn't shared details about the new generation of RibbonFET, but the general design provides improved transistor density and faster transistor switching by utilizing four stacked nanosheets surrounded entirely by the gate (you can see the cross-section with nmos and pmos transistors above).

Turbo Cells and Critical Paths

Intel's new Turbo Cells are a standout feature, but they are a bit complicated. Turbo Cells can be used for a multitude of purposes, but Intel specifically calls out that they will be utilized in the critical paths of the CPU and GPU, often referred to as speed paths. And for good reason.

Timing paths within a processor are routes that a signal travels along, through wires and logic gates, during normal operation. However, delays to those signals can interrupt the clock timing of the processor. The critical paths are those that have the longest total delay.

Because processors operate based on clock signals, the slowest critical path dictates the highest possible frequency limit of the entire chip, serving as a bottleneck to overall performance (there are distinctions here for the various clock domains, but the general principle holds true). Chip designers often use higher-speed transistors in these areas of a chip, but this comes at the cost of reduced transistor density and increased power consumption, as faster transistors are leakier and thus consume more power. The new Turbo Cells provide chip architects with a more refined tool to mitigate critical paths.

The 14A node features three distinct standard cell libraries, which use process node-specific building blocks (standard cells constructed with transistors) of pre-designed logic gates and circuit elements. Designers use electronic design automation (EDA) software tools to utilize the libraries during the design flow and generally lay them out in rows.

Intel's 14A has three different libraries: the 'tall' library has transistor cells optimized for high frequency (low density, leaky), the 'mid-size' library is optimized for performance per watt, and the 'short' library is focused on density for area- and power-sensitive applications. Intel has not shared density information for the various libraries yet.

Short libraries are used heavily in CPUs and GPUs to pack in the most transistors possible while keeping power density at manageable levels. That's where Intel's new Turbo Cells step in.

Turbo Cells are designed to enhance performance by increasing the transistor drive current for short libraries when they're used to create double-height libraries (the height of two standard rows), all while maintaining a high-density arrangement for optimal area efficiency.

The above graphic represents four different arrangements of nmos and pmos ribbons/nanosheets (pink and green) with varying widths and configurations to optimize drive current for different scenarios. The width of the ribbons can be adjusted, or they can be merged independently to create very wide ribbons for maximum drive current delivery. The various options provide designers with a robust toolkit for tailored implementations.

Intel says Turbo Cells can ultimately be used to mix in faster and less power-efficient cells with the power-efficient cells within the same design block to create the right balance of power, performance, and area (PPA) for any given use case.

Critical paths are the ultimate bottleneck; think of them as the weakest link in the chain. Intel's new Turbo Cells are designed to boost overall processor performance by speeding up those paths, but without making the compromises often used to solve the critical path problem. We'll have to wait until 2027 to see how that pans out.

Intel's new CEO Lip Bu-Tan took to the stage at the company's Intel Foundry Direct 2025 event here in San Jose, California, to outline the company's progress on its foundry initiative. Tan announced that the company is now engaging lead customers for its upcoming 14A process node (1.4nm equivalent), the follow-on generation of its 18A process node. Intel already has several customers with plans to tape out 14A test chips, which now come with an enhanced version of the company's backside power delivery technology dubbed PowerDirect. Tan also revealed that the company's crucial 18A node is now in risk production with volume manufacturing on schedule for later this year.

Intel also revealed that its new 18A-P extension, a high-performance variant of the 18A node, is now running through the fab with early wafers. Additionally, the company is developing a new 18A-PT variant that supports Foveros Direct 3D with hybrid bonding interconnects, enabling the company to stack dies vertically on top of its most advanced leading-edge node.

The Foveros Direct 3D technology is a key development because it provides a capability that rival TSMC already uses in production, most famously in AMD's 3D V-Cache products. In fact, Intel's implementation matches TSMC's offering in critical interconnect density measurements.

On the mature-node side of the operation, Intel Foundry has its first production 16nm tapeout in the fab now, and the company is also now engaging customers for the 12nm node it is developing in partnership with UMC.

Perhaps the most important developments at the show revolve around Intel's continued expansion with EDA and intellectual property (IP) partners that provide the critical tools and IP blocks that enable its customers to develop new designs with industry-standard design flows and tools. The company has also expanded its Intel Foundry Accelerator Alliance program to include the Chiplet Alliance and Value Chain Alliance programs.

Intel Foundry's progress comes during turbulent times in the semiconductor industry as geopolitical divisions threaten to fracture the global chip supply chain. Intel is currently the only US-based domestic supplier of leading-edge process node technology and advanced packaging capacity, a key advantage as tensions between China and TSMC continue to escalate. Despite TSMC's expansion of production in the US, a recent law passed by Taiwan now prevents the company from producing its most cutting-edge tech in the United States, leaving Intel as the only domestic foundry with both leading-edge chip production and R&D.

Naga Chandrasekaran, the Chief Technology and Operations Officer of Intel Foundry, and Kevin O’Buckley, the General Manager of Foundry Services, are also slated to deliver keynotes during the event, providing more details about the technology and roadmaps. We will update this article with additional information as it becomes available, but we have plenty to share to get started. Let's take a closer look at Intel's progress.

Intel 14A Process Node

Intel 14A Process Node

Intel's 14A, the next generation after 18A, is already in the works and scheduled for risk production in 2027. If all goes to plan, 14A will be the industry's first node to employ High-NA EUV lithography. TSMC's competing A14 (1.4nm-class) node is expected to arrive in 2028, but the Taiwanese company will not utilize High-NA for production.

Intel has already shared early versions of the Process Design Kit (PDK), a set of data, documentation, and design rules that enables the design and validation of a processor design, with its lead 14A customers. Intel states that multiple customers have already indicated their intention to build chips using the 14A process node.

Intel's 14A will have a second-generation version of its PowerVia backside power delivery technology. The new PowerDirect implementation is a more advanced and complex scheme that delivers power directly to each transistor's source and drain through specialized contacts, which minimizes resistance and maximizes power efficiency. This is a more direct and efficient connection than Intel's current PowerVia scheme, which connects to the contact level of the transistors with Nano TSVs.

TSMC's N2 node does not include backside power delivery; however, with A16, the company will employ a direct-contact backside power delivery network, dubbed Super Power Rail (SPR). A16 is essentially a derivative of the N2P node with SPR. The A16 node is expected to enter production in late 2026. TSMC's A14 will not leverage a backside power design methodology.

Intel's 18A-PT process node enables die stacking

Intel's 18A-PT process node enables die stacking

Intel's 18A node is the mainstream variant, but the company also has several 'line extensions' of the node, designated by different suffixes. These flavors of the underlying node are tailored for different use cases.

Intel has a new 18A variant up its sleeve; the new 18A-PT node that will provide the same performance and efficiency benefits as the performance-oriented 18A-P, but adds in Foveros Direct 3D hybrid bonding. This bump-less copper-to-copper bonding technique (meaning it doesn't use microbumps or solder to connect the two dies) fuses chips together with through-silicon vias (TSVs). Intel's implementation will employ a pitch of less than 5 microns, a distinct improvement over its initial goal of a 10um pitch by 2023, to fuse chiplets on top of the 18A-PT die. The pitch is a measurement of the center-to-center spacing between the interconnects, and lower values indicate higher density, which is better.

Notably, AMD uses TSMC's SoIC-X technology, a similar hybrid bonding approach, to fuse an L3 chiplet atop its X3D processors with a 9 micron bump pitch. TSMC's SOIC-X tech currently ranges from 4.5 to 9 microns, but the company has a 3-micron pitch offering on the roadmap for 2027. If productized effectively and on schedule, Intel's Foveros Direct 3D will dramatically improve its positioning against TSMC's packaging technology.

Intel's Clearwater Forest will be its first to use Foveros Direct 3D packaging, but the company hasn't disclosed the pitch for that specific product yet. Notably, TSVs are typically only included in the base die, and Clearwater Forest uses Intel 3-T for the base die with the Intel 18A compute dies stacked on top. Enabling TSVs for 18A will thus allow it to also have dies stacked atop, and SRAM cache is a logical use case.

Intel 18A process node updates

Intel 18A process node updates

As we reported last month, Intel's 18A (1.8 nm-equivalent) process node has entered risk production, marking the commencement of the first low-volume production runs of the node, with High Volume Manufacturing (HVM) scheduled for the end of the year. Intel did not specify which processors had begun production, but the timing generally aligns with expectations for its Panther Lake processors, which are expected to arrive at the end of the year. Intel's first 18A production will come from its Oregon fabs, but the company has already 'run the [18A] lot' through its Arizona fab, indicating it will soon begin production there as well.

The 18A node is the first in the industry to be productized with both a PowerVia backside power delivery network (BSPDN) and RibbonFET gate-all-around (GAA) transistors. PowerVia provides optimized power routing on the back of the chip to improve performance and transistor density. RibbonFET also offers better transistor density, along with faster transistor switching, in a smaller area through the use of four vertical nanosheets surrounded entirely by the gate.

The 18A node enters HVM in roughly the same timeframe as TSMC's competing 2nm N2 node. However, TSMC's N2 node does not come with a backside power delivery network, but it does have GAA technology with three vertical nanosheets. There have been some basic comparisons between the process nodes made based on presentations at a recent industry event. The general takeaway is that Intel's node is faster and lower-power than TSMC's, though TSMC retains the edge in density (and presumably cost). However, these distinctions could vary depending on the specific implementation in different chip designs.

Intel divulged today that it has wafers of its high-performance 18A-P node in the fab. This 18A variant features an optimized power and frequency curve, providing an 8% improvement in performance per watt. This can be leveraged as either higher clock speeds or lower power consumption at the same performance, depending upon chip-specific tuning.

The 18A-P node is design rule-compatible with the 18A node, easing the design process for customers. Intel is already collaborating with Electronic Design Automation (EDA) software vendors to enable broad support for industry-standard design tools, and it is also working with Intellectual Property (IP) designers to provide the necessary IP blocks, thereby simplifying implementation.

Mature Nodes: 16nm and 12nm continue advancing

Mature Nodes: 16nm and 12nm continue advancing

Intel Foundry not only addresses the leading edge of technology, but it is also working on several mature nodes. Intel's 16nm node, which is essentially a version of its 22FFL node that leverages industry standard design tools and PDKs, has a tapeout in the fab now.

Intel is also continuing its work with partner UMC to develop a 12nm node that will be produced in three of Intel's Arizona fabs beginning in 2027. In fact, Intel is currently engaging lead customer for this node. 12nm will be used primarily for mobile communication infrastructure and networking applications.

Takeaways, for now

Takeaways, for now

Intel canceled high volume manufacturing of the 20A node as a cost-cutting measure, but the company is now on the cusp of of production with with its18A node, marking a critical milestone as it looks to regain the manufacturing lead over TSMC. The addition of new line extensions, with the die-stacking-capable 18A-PT being a particularly strong advance, will help the company to further broaden its appeal to potential foundry customers.

The development of the company's 14A node is also well underway, signifying that the company is on track to providing a steady cadence of new nodes and features to the roadmap. We haven't yet heard any new details about Intel's plans for its 10A (1nm-class) process node yet, which is expected to begin development in 2027. Intel's press release also doesn't mention any new progress on its Intel 3 node, but we expect more details to emerge throughout the day.

Intel's event is focused heavily on displaying its broad portfolio of EDA, IP, and services driven by an ecosystem of indsutry stalwarts, like Synopsys and Cadence. The new Intel Foundry Chiplet Alliance is also an important development that will enable customers to mix-and-match chiplets into their design based upon interoperable and validated designs.

Intel's advanced packaging services are also of particular importance as they provide the fastest on-ramp to meaningful revenue generation. Intel did mention that it will make its 3D stacking Foveros implementation available to foundry customers, and noted a new partnership with Amkor. However, details are slight for now. We'll update this article as more information becomes available.

Intel on Thursday posted its financial results for the first quarter of 2025. The company's earnings were flat year-over-year; however, its losses deepened, and its gross margin declined despite lower operating expenses. While sales of the company's data center grade products demonstrated signs of growth, sales of client CPUs declined compared to the same quarter a year ago. Perhaps more importantly, Intel gave a bleak outlook for the second quarter due to macro challenges. 

In the first quarter of 2025, Intel reported flat year-over-year revenue of $12.7 billion, with a net loss of $821 million, nearly twice the amount compared to the same quarter a year ago. The company's gross margin declined to 36.9%, pressured by a product mix, startup costs for the 18A ramp-up, and uncertainties (which Intel referred to as macroeconomic headwinds).

The company's operating expenses — including research and development (R&D) as well as management, general, and administrative costs (MG&A) — declined to $4.8 billion in Q1 2025 from $5.9 billion in Q1 2024. However, despite this decline, the company's losses increased. 

"The first quarter was a step in the right direction, but there are no quick fixes as we work to get back on a path to gaining market share and driving sustainable growth," said Lip-Bu Tan, Intel CEO. "I am taking swift actions to drive better execution and operational efficiency while empowering our engineers to create great products. We are going back to basics by listening to our customers and making the changes needed to build the new Intel." 

Perhaps the most alarming sign is that Intel's Client Computing Group (CCG) revenues fell 8% year-over-year to $7.6 billion. This drop was attributed to weaker-than-expected PC demand, particularly in the consumer segment, competitive pricing, and unfavorable product mix that includes a plethora of products made by TSMC. Interestingly, many of Intel's customers favored older-generation products like Raptor Lake over newer, higher-cost platforms such as Meteor Lake, Arrow Lake, and Lunar Lake. 

Despite these challenges, Intel noted demand for AI PCs from business customers, as well as enterprise fleet upgrades and Windows 10 end-of-service migrations, although this was insufficient to offset the broader softness in consumer sales. 

Intel's Data Center and AI (DCAI) business unit reported $4.1 billion in revenue in Q1 2025, achieving an 8% year-over-year increase, making it one of the few growth areas for the company. The performance was primarily driven by strong demand from hyperscalers for host CPUs in AI server deployments. However, the segment faced margin pressure due to competitive dynamics from AMD, product mix, and elevated demand for older-generation parts rather than newer offerings. 

Despite the revenue growth, Intel acknowledged macroeconomic uncertainty, potential spending pullbacks, and competition from AMD and Arm-based server solutions as risks that could affect DCAI performance in the coming quarters. The company remains focused on stabilizing market segment share and increasing average selling prices (ASPs) while preparing for the ramp of its next-generation server products. 

Intel Foundry reported $4.7 billion in revenue, reflecting a 7% year-over-year increase driven mostly by internal demand, particularly from Intel's own product groups for wafers and advanced packaging services. Despite revenue growth, the Foundry segment continued to operate at a significant loss, posting an operating loss of $2.3 billion, which remained roughly flat compared to the previous quarter. 

Intel's Lip-Bu Tan reiterated at the conference call that the company's Foundry success hinges not just on manufacturing capabilities but also on building customer trust, improving process design enablement, and supporting a broader range of customer flows. For now, the key mission of Intel Foundry is to ramp up production of Intel 18A-based Panther Lake and then Clearwater Forest processors in late 2025 – 2026 to prove that IF has a node that is competitive with TSMC's N2. 

Intel is set to detail (PDF) the advantages of its 18A manufacturing technology (1.8nm-class) compared to its Intel 3 fabrication process at the upcoming VLSI Symposium 2025. As expected, the new production node will offer substantial benefits across power, performance, and area (PPA) metrics, thus providing tangible advantages both for client and data center products. 

Intel claims that its 18A fabrication process delivers 25% more performance at the same voltage (1.1V) and complexity, as well as 36% lower power at the same frequency and voltage of 1.1V for a standard Arm core sub-block compared to the same block fabricated on Intel 3 process technology. At a lower voltage (0.75V), Intel 18A provides 18% higher performance and 38% lower power. In addition, 18A consistently achieves 0.72X area scaling compared to Intel 3. 

Intel's 18A manufacturing technology is the company's first node to rely on gate-all-around (GAA) RibbonFET transistors and feature PowerVia backside power delivery network (BSPDN), two features that enable major PPA advantages. 

The standard cell layout comparison highlights the significant physical scaling achieved by Intel 18A over Intel 3 in both High-Performance (HP) and High-Density (HD) libraries. Intel 18A reduces cell heights from 240CH to 180CH in HP libraries and from 210CH to 160CH in HD libraries, which represents a ~25% reduction in vertical dimension. This tighter cell architecture allows for increased transistor density, contributing directly to improved area efficiency. 

The use of PowerVia BSPDN enables more efficient vertical routing by offloading power lines from the front side of ICs, freeing up space for signal routing and further compacting the layout. Additionally, refined gate, source/drain, and contact structures improve overall cell uniformity and integration density. These enhancements collectively enable Intel 18A to deliver better performance-per-area and energy efficiency, supporting more advanced and compact chip designs. 

Intel is reportedly on track to start high-volume manufacturing of compute chiplets for its codenamed Panther Lake processors for client PCs later this year and then chiplets for Clearwater Forest data center systems in early 2026. In addition, the company is on track to tape out the first third-party designs on 18A in mid-2025. 

Apparently, there is interest in developing third-party chips for Intel 18A. In addition to presenting a general paper describing its 18A technology, Intel plans to present a paper describing a PAM-4 transmitter implemented using 18A production node with a BSPDN that is co-authored by engineers from Intel, Alphawave Semi (a contract chip designer and IP provider), Apple, and Nvidia. This does not necessarily mean that Apple or Nvidia will use Intel's 18A for production silicon, but this at least means that they are interested in checking it out. 

Speaking of Apple and Nvidia, TSMC said that virtually all of its partners plan to adopt its N2 (2nm-class) process technology, so it is reasonable to expect this node to be more widely used than Intel's 18A. Nonetheless, for Intel it is crucial to show that it can develop a competitive node and ramp it to high volume, so 18A will play a vital role for the future of Intel's foundry business.

While many high-tech companies saw their market capitalization drop following the introduction of President Trump's administration import duties, Intel suffered more than many others as its stock price and market capitalization declined to a 16-year low. Intel, which has suffered technological and financial challenges in the recent quarters, now faces uncertainties with demand and now potentially higher costs.

Intel's closed at $18.13 on Tuesday, down 7.36% and hitting its lowest close since July 2009, according to SeekingAlpha. The company's market capitalization is now at $79.06 billion, also the lowest since July, 2009, after the company faced the steepest drop in demand for its CPUs and other products ever. It remains to be seen what the future holds for Intel as it now faces the challenges associated with the new import tariffs set by the U.S. administration.

Intel's success, whose stock has lost more than half its value over the past year, now largely depends on the launch, later this year, of the company's codenamed Panther Lake processor made on its 18A process technology. As well as success of the 18A production node. If Intel can produce Panther Lake CPUs with competitive performance, yields, and costs using its 18A manufacturing technology, then investors will regain their confidence in Intel. If not, the company will probably have to spin off its manufacturing operations and focus solely on product design.

U.S. import tariffs can have a drastic effect on U.S. semiconductor companies in general. Even impacting AMD and Intel despite the fact that chips are currently not yet taxed with punitive tariffs. If PCs get 20% more expensive in the U.S. demand for these products will get lower. Once tariffs on chips are enacted, the margins of companies like AMD and Nvidia will suffer significantly as the lion's share of their processors are made in Taiwan and then packaged in China, Malaysia or Taiwan. The direct effect of tariffs on Intel could be lower as the company outsources around 30% of its silicon, but plans to reduce that share once Panther Lake CPUs are ramped. However, the company will now have to pay more for its production tools made outside of the U.S.

It should be noted that Intel's decline was part of a broader selloff across the semiconductor sector, driven by tariffs. AMD sank 6.5%, reaching a level not seen since February 2023, Qorvo fell 9.9%, hitting its lowest point since 2016, while Micron dropped 4.1%, marking its weakest close since 2023, according to SeekingAlpha. Apple, Arm, Nvidia, Qualcomm, and TSMC, also posted losses.

Did the semiconductor manufacturing world just shrink a nanometer or two? Intel and TSMC have reportedly reached a preliminary agreement to create a joint venture to operate Intel's fabs in the U.S.

The news comes from Reuters, which cites a report from The Information based on two sources familiar with the matter. Intel has not yet commented on the matter; Tom's Hardware has reached out to the companies for more information.

Under the terms of the agreement, TSMC is said to own 20% of the joint venture. It is unclear which companies will own the remaining 80%, but earlier this year TSMc reportedly approached multiple leading fabless chip designers headquartered in the U.S. — including AMD, Broadcom, Nvidia, and Qualcomm — about investing in the joint venture, which would own multiple fabs in America. Both Nvidia and a TSMC board member later denied the discussions.

This arrangement was reportedly influenced by the U.S. government, specifically the White House and Department of Commerce, as part of efforts to address ongoing operational difficulties at Intel.

U.S. authorities view the partnership as a means to stabilize Intel: The IDM 2.0 strategy has faced multiple challenges as the company has so far become a leader neither in products nor in semiconductor production technologies. At the same time, the current U.S. government will not support sales of Intel's fabs to a foreign investor, especially TSMC.

At this point it is unclear what exactly TSMC's involvement would be with Intel's American fabs — which cost tens of billions of dollars — many of which can only be used to make processors for Intel (including fabs capable of producing on Intel 3 and Intel 4 process technologies) and only one or two of which can make processors on Intel's 18A fabrication technology.

It is also unclear how TSMC's plans to own 20% of Intel Foundry aligns with its own plans to invest $165 million in its Arizona Fab 21 site to make chips for its partners, including Apple.

The financial markets responded quickly to this news. Intel's stock price increased nearly 7% after the report surfaced, which helped the company to recover after a drop of market capitalization caused by the new import tariffs that will be implemented by the U.S. By contrast, shares of TSMC traded in the U.S. dropped by about 6%, highlighting differing investor reactions to the deal.

As both Intel and TSMC are in their quiet periods, they cannot make any comments regarding future plans or even factors that can impact them materially, but we have reached out for comment.

Recently appointed Intel CEO Lip-Bu Tan made his first keynote at Intel Vision 2025, where he said he will focus on earning customer trust and catering to their needs and demands. This change in the chipmaking giant’s mindset began with former CEO Pat Gelsinger’s IDM 2.0 plan, and Mr. Tan is apparently pushing this agenda harder with support from his predecessor.

Intel needs to do this, especially as TSMC founder Morris Chang said that Tim Cook told him in 2011 that Intel didn’t know how to be a foundry. It was thought that Team Blue could not accommodate the changes external chip customers required, making it a poor fit for manufacturing the highly customized chips that different devices necessitate.

“Foundry is a service business, and that is built on the foundational principle of trust — that is very important,” said Mr. Tan. “And also realize that every foundry customer has their own unique design methodology and style of design. That I part I learned from my Cadence days, and it is something that we need to learn and how to adopt [to] each different customer.”

Flexibility allowed TSMC to surpass Intel in the semiconductor industry, especially as this characteristic enabled the company to land Apple as its exclusive chip supplier. Having a huge cash cow like that allowed the company to invest more into research and development, which is likely why TSMC is the leading semiconductor company today.

But Intel isn’t just giving up the fight, especially with the pending arrival of its Intel 18A process node. Mr. Tan said that he’s looking forward to shipping Panther Lake on 18A later this year, especially as it begins high-volume production. Beyond that, he also mentioned the company is continuing work on the more advanced 14A node.

To drive this innovation, Lip-Bu Tan said, “Under my leadership, Intel will be an engineering-focused company. One of my top priorities is to retain and recruit top talent — engineering — and empower innovation and growth.” He also added, “I believe Intel has lost some of this talent over the years; I want to create a culture of innovation empowerment.”

Before Mr. Tan came on board as the company CEO, there was speculation on whether the next CEO should spin off Intel’s foundry business, and if they should slash more jobs to help with profitability. After his speech, it now seems that the path he’ll take for Intel is to keep the foundry and win more customers. Furthermore, Lip-Bu Tan is apparently trying to hire more engineers and other talents the company needs to advance innovation.

The Intel CEO’s keynote address at Vision 2025 sheds light on the path that Intel will take in the coming years. It will take a much longer time to rehabilitate the entire company, but Lip-Bu Tan’s direction aims to pull the company back from the brink.

At its Vision 2025 conference, Intel announced today that it has entered risk production of its 18A process node, a crucial production milestone signifying that the node is now in the early stages of low-volume test manufacturing runs.

Intel's Kevin O'Buckley, the Senior Vice President of Foundry Services, made the announcement as Intel nears the full completion of its "five nodes in four years" (5N4Y) plan, which was originally set in motion by ex-CEO Pat Gelsinger as part of the company's quest to retake the semiconductor crown from rival TSMC. The conference also marks the first time that new CEO Lip-Bu Tan has taken to the stage as the new leader of Intel.

Intel originally announced its four-year plan in June 2021, and despite canceling high volume manufacturing of the 20A node as a cost-cutting measure, Intel is on the cusp of reaching the finish line with its 18A node. Notably, Intel's 5N4Y plan hinged on the process nodes being available for production rather than actively being in the final high volume manufacturing (HVM) stage.

"Risk production, while it sounds scary, is actually an industry standard terminology, and the importance of risk production is we've gotten the technology to a point where we're freezing it," O'Buckley explained. "Our customers have validated that, 'Yep, 18 A is good enough for my product.' And we have to now do the 'risk' part, which is to scale it from making hundreds of units per day to thousands, tens of thousands, and then hundreds of thousands. So risk production [..] is scaling our manufacturing up and ensuring that we can meet not just the capabilities of the technology, but the capabilities at scale."

Risk production is one of many steps on the long road to fielding a new process node and indicates that the company believes the node is nearly ready for HVM. Intel has already produced plenty of 18A test chips/shuttles, typically wherein multiple different designs are prototyped on a single wafer.

In contrast, risk production consists of pressing wafers full of a single chip design into low-volume manufacturing as the company tweaks its manufacturing flow and qualifies the node and Process Design Kit (PDK) in real-world production runs. Intel will then scale production up to higher levels in the second half of the year. This step of bringing up a semiconductor process comes after the R&D, design, and prototyping stages of development.

There is some 'risk' to risk production, though, as yields and functionality (parametric yields, etc.) can be sub-par as the company refines its manufacturing techniques and optimizes its tooling as it works up the learning curve. As such, customers typically use risk production to manufacture qualification or engineering samples, and the customers aren't given as stringent yield targets/guarantees as they are with nodes fully qualified for HVM.

However, some customers are willing to assume those risks to get the payoff of gaining significant time-to-market advantages through early access to the node, which then allows them to adjust and perfect their designs before competitors even begin production.

Intel hasn't yet specified if the 18A risk production is for its own Panther Lake processors, which it says will arrive on schedule later this year, or if the production runs are for its external foundry customers. However, Panther Lake, Intel's first 18A processors, will enter mass production later this year. As such, the Panther Lake chips are likely the risk production subject; this schedule generally aligns with our expectations for a typical risk production-to-HVM timeline for Intel.

Although Intel pioneered several new technologies on its cancelled 20A node, the 18A (1.8nm) chips will be the first productized chips with both PowerVia backside power delivery and RibbonFET gate-all-around (GAA) transistors. PowerVia provides optimized power routing to improve performance and transistor density, and RibbonFET also provides better transistor density along with faster transistor switching, but in a smaller area.

Intel also continues to work on its broader foundry roadmap, which includes the follow-on 14A node, Intel's first to utilize High-NA EUV lithography. Numerous node extensions to other nodes will further expand Intel Foundry Services' portfolio to a broader range of applications.

These developments come during turbulence at Intel Foundry as the company adjusts to changing macroeconomic factors. Intel recently delayed the build-out of its Ohio operations until 2030, for example. However, the announcement of 18A risk production mirrors the positive reports that Intel is running its first 18A wafers through its Arizona fabs.

We expect to learn much more about Intel's future plans at its Foundry Direct Connect event in late April.

This article covers our picks for the best graphics cards for gaming in 2026. Amid the AI gold rush and consequent supply crunch for consumer silicon, no truly new gaming GPUs have been introduced in almost a year. If you haven't already upgraded your graphics card after the GeForce RTX 50-series and Radeon RX 9000-series launches in 2025, well, you're still looking at the exact same products now.

AMD did make its formerly China-only Radeon RX 9070 GRE available globally after Computex 2026, but in our review, we found that $549 product to be too expensive given the level of performance it delivers and the compromises made to hit its price point, so it isn't joining the list here. Check out that coverage for all the details.

Most of the products we recommend remain at elevated prices compared to their MSRPs, but this is just life in mid-2026.

It's admittedly cold comfort, but unless you're shopping for an RTX 5090, graphics card prices haven't risen much more than they already did earlier this year. Compared to the doubling or tripling of prices we've seen for RAM kits and SSDs in 2026 versus last year, a GPU upgrade remains a relatively affordable (and self-contained) option, either as a boost for an existing PC or part of an all-new parts list.

Even if you can’t build an all-new system, you can just put a new graphics card in an older PC and still enjoy boosts to gaming performance, image quality, or both—especially if you can upgrade your monitor at the same time.

As we discuss in further depth below, the arrival of DLSS 4.5 upscaling (for RTX 40-series and 50-series cards, at least) and expanded multipliers for Multi-Frame Generation, which now can boost frame rates by up to 5x or 6x, means that driving a high-resolution, high-refresh-rate monitor is now easier than ever if you're considering a GeForce RTX 50-series graphics card.

Read on to see our picks in today's gaming graphics card market.

Best graphics cards for gaming, at a glance

The above list shows all the latest-gen graphics cards we feel stand out in their segments. If you want to see how all of the current and prior generation GPUs stack up, check our GPU benchmarks hierarchy. We also have performance benchmarks further below.

When accounting for pricing, we perform our own research to find the midpoint of current prices for a given graphics card, rather than taking a vendor's MSRP at face value. We feel this method tends to be most representative of the price you're likely to see for products in stock.

If you can find a card for less than this midpoint, it's likely closer to (or even less than) a vendor's MSRP and a better value. Conversely, if you find one for more than this midpoint, it could be a worse value (or too close in price to a more powerful card that's a step up). Tread carefully.

The overall performance ranking incorporates 19 games from our 2026 test suite, which takes the geometric mean (i.e., equal weighting) for both rasterization and ray tracing games. Note that we are not including any upscaling or frame generation results in the table.

Raw performance may be the most important consideration for most gamers, but it's not the only metric that matters. Our subjective rankings below factor in price, power usage, and power efficiency, and features colored by our own years of experience. Others may offer a slightly different take, but all of the cards on this list are worthy of your consideration.

Upscaling and frame generation mean GPUs are more than just a chip

GPU performance goes beyond the hardware these days. Choosing a particular GPU vendor means you're buying into a complex software stack that includes upscaling, frame generation, and (more rarely) AI-powered RT denoising technologies.

In Nvidia's corner, the DLSS 4.5 upscaling model and its second-generation transformer architecture offer superior image quality to other upscaling tech (and with lower input resolutions, meaning higher potential performance), but it's more computationally expensive than past DLSS models and works best on RTX 50-series and 40-series cards.

The DLSS 4 model and its first-gen transformer architecture still work with cards going all the way back to the RTX 20-series family. Not all games implement DLSS 4 natively, but Nvidia allows you to force the usage of that model in many older titles through the Nvidia App utility, so you can practically always get the latest and greatest.

Between native support and driver overrides, DLSS is available in virtually any modern game you might want to play. Nvidia recently marked DLSS feature availability in over 1000 titles.

RTX 50-series GPUs are Nvidia's first with support for multi-frame generation (MFG), which allows Blackwell GPUs to insert anywhere from one to five AI-generated intermediate frames between each native one (for a 2x, 3x, 4x, or even 5x or 6x frame rate boost). RTX 40-series GPUs also support framegen, but only with a 2x boost.

Meanwhile, AMD's FSR 4 offers AI-enhanced upscaling with superior image quality to other FSR versions, but official support for it is limited to RX 9000-series Radeons for now. AMD will bring FSR 4 upscaling to RX 7000-series cards in July 2026 and RX 6000-series cards in early 2027.

In the meantime, AMD's FSR 3.1 and earlier upscalers still work on any GPU, but the image quality tends to be noticeably lower than both DLSS and FSR 4.

AI-enhanced FSR framegen (aka ML Frame Generation) arrived on AMD cards as part of the FSR Redstone update late last year. Like FSR 4 upscaling, ML Frame Generation is limited to Radeon RX 9000 cards, and it can be enabled in compatible games using a control panel override for titles that don't natively have it.

Legacy FSR frame gen remains available, too. Its framerate-doubling boost remains cross-compatible with GPUs from all vendors, but its image quality can't keep up with the AI-powered frame gen tech of the latest AMD and Nvidia models.

Intel XeSS upscaling can be superior to FSR 3.x, but it isn't available in as many games as FSR or DLSS. It works best on Arc GPUs, but like FSR, it's cross-compatible with a wide range of graphics cards from AMD and Nvidia if you need it.

XeSS 2 with AI-enhanced frame generation is now available in 95 games as of this writing and requires an Arc GPU. XeSS 3 brings multi frame generation to the party through both native support and a driver override in compatible titles.

All that said, we don't think you should go out of your way to buy an Intel Arc card for gaming in 2026 for reasons we'll get into later.

1. Best high-end graphics card: GeForce RTX 5070 Ti, $1099.99

If you want the best blend of high performance and cutting-edge graphics tech out there for 1440p or 4K gaming, the GeForce RTX 5070 Ti is it. This card comes with full support for Nvidia’s latest DLSS 4.5 upscaling and Multi Frame Generation tech, and its 16GB of VRAM gives you full freedom to enable every DLSS 4 feature.

AMD’s closest competitor, the Radeon RX 9070 XT, is way cheaper than the RTX 5070 Ti right now, but the AMD card obviously doesn’t support DLSS 4 or MFG. For the privilege of those capabilities, you'll generally need to spend a whopping 45% more cash right now for just 5% more baseline performance than AMD’s best before you start enabling all the DLSS 4 features Blackwell supports.

Is that worth it? Yes, if you can swing it. Here's why: getting the best gaming performance on modern graphics cards is as much a software problem as a hardware one. Tuning your gaming experience to taste requires access to high-quality upscaling, frame generation, and (more infrequently) an AI-powered RT denoiser like DLSS Ray Reconstruction.

Even amid its shift to AI and data center products, Nvidia ensures that its full suite of DLSS tech is adopted in virtually every new game, whereas AMD's support of FSR 4 adoption has become rather hit-or-miss.

The RTX 5070 Ti also offers superior RT performance versus the RX 9070 XT across our 2026 test suite. Beyond that baseline, Nvidia is working with developers to enable impressive path-traced effects in many of the latest AAA releases.

In our recent experience, path-traced games play best with DLSS 4.5 upscaling and MFG at your disposal, and being able to consistently rely on the availability of those features makes the extra cash for the 5070 Ti worth it.

Our recent GPU Hierarchy retesting has shown that high-end graphics cards are becoming five- to eight-year investments, and Nvidia's ongoing commitment to developer relations and new software features means that you'll enjoy a first-class gaming experience throughout the life of your 5070 Ti no matter what games you want to play on it.

Spread out over that time span, the extra cost of the RTX 5070 Ti versus the RX 9070 XT is worth it for the better experience.

What about the RTX 5080? Nvidia's second-fastest Blackwell card is anywhere from 8% to 16% faster than the 5070 Ti, with the biggest gap at 4K. Prices for the 5080 in June 2026 remain insane, however, and at the midpoint of current prices, the 5080 is 33% more expensive than the 5070 Ti.

There's no way the RTX 5080 offers anywhere close to enough value for the money to justify the step up right now unless you're looking for the fastest thing this side of a 5090 for 4K gaming.

Read: Nvidia GeForce RTX 5070 Ti review

2. Best enthusiast value graphics card: Radeon RX 9070 XT, $759.99

The Radeon RX 9070 XT is AMD's most well-rounded graphics card in years. It delivers raw gaming performance within spitting distance of the GeForce RTX 5070 Ti for far less money, making it a strong value at first glance. But that appealing price tag comes with a number of asterisks in mid-2026 that mean it's no longer our first pick for high-end PC gaming.

AMD shored up two of its greatest weaknesses against Nvidia with the RX 9070 XT's RDNA 4 architecture: RT performance and AI acceleration, both of which are closer to Nvidia's latest and greatest. And AMD did all that while keeping power efficiency right there with Nvidia, too.

The FSR 4 upscaler is a big jump in image quality over FSR 3, and FSR ML Frame Generation now offers higher-quality framegen on the RX 9070 XT than FSR 3's approach, although it's still limited to a simple doubling of frame rates versus DLSS Multi Frame Generation's versatility.

The problem for the RX 9070 XT in mid-2026 is that FSR 4.x upscaling still trails Nvidia's flagship DLSS 4.5 in image quality, and AMD isn't driving the adoption of FSR 4 features nearly as aggressively as Nvidia is for DLSS. Driver-level overrides for those features can't entirely close the gap.

Worse, you might find the RX 9070 XT entirely shut out of features that you might want to enable in certain games. For just a couple of examples, Radeon gamers can't enable path-traced effects at all in recent titles like Pragmata and Resident Evil Requiem, and 007 First Light sticks you with FSR 3 upscaling that can't be overriden through a driver toggle due to the way it's implemented.

And in our latest GPU Hierarchy retesting with the RX 9070 XT, we saw major performance issues in Grand Theft Auto V Enhanced and minor visual corruptions in Stalker 2 that weren't present on GeForces or on RX 7000- or RX 6000-series cards. We don't think these issues should have slipped past any QA program, especially for such popular and high-profile games, but they sting especially hard on a current-gen product.

All that means the overall ownership experience of an RTX 5070 Ti and an RX 9070 XT is significantly different in mid-2026. We think that gamers shopping in this price class should be able to expect a consistently high level of software feature support and quality across all the games they might want to play, and Nvidia provides that assurance better than AMD does right now.

If you're willing to gamble with the availability of FSR 4 features, for RT or path-traced effects, and don't care to tune the smoothness of your gaming experience with frame generation, the RX 9070 XT's shortcomings versus the RTX 5070 Ti may be easier to overlook given the large amount of cash that will remain in your pocket.

But we also think that you should look closely at what you're giving up before reflexively choosing an RX 9070 XT over an RTX 5070 Ti, despite its strong value at a glance.

Read: AMD Radeon RX 9070 XT review

3. Best midrange graphics card: GeForce RTX 5070, $659.99

Until 2026 rolled around, the GeForce RTX 5060 Ti 16GB had been our entry-to-midrange Blackwell gaming favorite. But the $579 midpoint of current pricing puts the 5060 Ti 16GB's on-shelf price above that of the RTX 5070's $549 MSRP, and the 5070 is one of the least marked-up graphics cards out there at the moment.

As a result, it's possible to find RTX 5070s for about $670, and that makes it an easy call to step up for less than $100 more than 5060 Ti 16GBs.

The RTX 5070 is about 30% faster than the RTX 5060 Ti 16GB across our 2026 test suite, and that's a huge leap that you'll easily see on the right monitor for just 15% more money.

The advent of DLSS 4.5 upscaling, which makes it possible to achieve superior delivered image quality at lower input resolutions than older DLSS versions, also takes some VRAM pressure off the RTX 5070's 12GB of GDDR7, making the deployment of RT and DLSS MFG more practical on this card than it has been in the past.

And as with the RTX 5070 Ti, the universal availability of DLSS 4.5 (both natively and through app overrides) plus MFG makes this card a fast and flexible performer across all of the games you might want to play in 2026.

Given the image quality of DLSS 4.5 and the smoothness boost of MFG, along with the higher baseline RT performance of this card versus the 9070 in our 2026 testing, we think the 5070 should be your first pick for a midrange gaming card right now.

In an ideal world, the RTX 5070 would have more VRAM to allow for unhindered exploration of everything DLSS 4 and MFG have to offer, especially at a native 4K resolution. If you're pushing those limits, we'd still recommend the Radeon RX 9070 thanks to its 16GB of VRAM.

But if you're on a 1440p monitor where VRAM is less of an issue and want DLSS 4.5 over FSR 4, as most gamers do, the RTX 5070 is still a strong performer, and you're less likely to run into its limits.

Read: Nvidia GeForce RTX 5070 review

4. An AMD midrange alternative: Radeon RX 9070, $629.99

If you primarily play raster titles at native resolution and aren't on board with upscaling or framegen, the Radeon RX 9070 remains a strong midrange alternative to the RTX 5070. It's one of the least marked-up 16GB graphics cards available even with today's AI headwinds, and in a world where MSRPs have largely been forgotten, that makes the RX 9070 a strong value.

The GeForce RTX 5070 and RX 9070 go neck-and-neck in our test suite, but the RX 9070 has 16GB of VRAM and the RTX 5070 has just 12GB. Especially if you're trying to push 4K games at native resolution, that extra VRAM matters.

But the advent of DLSS 4.5 upscaling, which provides image quality that's practically indistinguishable from native rendering even at relatively low input resolutions, means that the RTX 5070 is a more potent midrange graphics card in 2026 than it was at launch.

On top of their inherent technical superiority, you can find DLSS 4 and MFG in most every game released today, which can't be said for FSR 4.x upscaling or ML framegen. AMD's driver overrides make up some of the gap, to be sure, but not all of it.

And as with the RX 9070 XT, AMD gamers may find themselves locked out of certain features like path tracing (in major releases like Pragmata and Resident Evil Requiem) or FSR overrides (in 007 First Light) entirely.

The RX 9070 is subject to the same minor image quality issues and performance hitches we saw with the RX 9070 XT, and those issues could certainly be overcome with future software updates. But we think that if you're looking for the best midrange graphics card, it should be free of those issues entirely, and so the RTX 5070 is our first pick for this price point right now.

Read: AMD Radeon RX 9070 review

5. Best enthusiast value graphics card: Radeon RX 9060 XT 16GB, $469.99

AMD's Radeon RX 9060 XT 16GB can handle basically anything the mainstream gamer can throw at it at 1920x1080 and 2560x1440, all at a price that comes in way under the sky-high markups on the RTX 5060 Ti 16GB as of this writing.

At a midpoint of $459.99 in mid-2026, prices for the RX 9060 XT 16GB are the highest we've ever seen, dulling the 9060 XT 16GB's reputation as the value-minded builder's GPU of choice. But with no cheaper Radeons worth recommending in the lineup, what can you do?

In any case, the RX 9060 XT enjoys the much-improved ray-tracing and AI performance of the RDNA 4 architecture, both of which bring Radeons a lot closer to the latest Nvidia competition. And its 16GB of VRAM gives mainstream gamers the assurance they'll basically never find VRAM a bottleneck in modern games at 1080p and 1440p resolutions.

Like the RX 9070 XT, the 9060 XT 16GB gives you access to AMD's much-improved FSR 4 upscaling tech, allowing you to boost performance with a small hit to image quality in the small but growing list of titles that support it.

Even with its new ML-powered model, FSR Frame Generation remains limited to a doubling of output frame rate at best, so it’s not a direct competitor to Nvidia’s DLSS 4 with MFG.

If you want more frames, AMD just launched the RX 9070 GRE globally for $549, and it provides a decent step up in performance for less than $100 more, especially if you're only gaming at 1080p or 1440p. But the more powerful RX 9070 can be found for just $50 more than the GRE, and then you're contemplating the even more powerful and versatile RTX 5070, too.

The RTX 5060 Ti 8GB is the RX 9060 XT 16GB's closest Nvidia competition, dollar for dollar, but we can’t recommend it at all. If you're spending over $350 on a GPU, we don't think you should have to fine-tune every setting to avoid running out of VRAM. The RX 9060 XT is easy to live with for a wide range of gamers in a wide range of titles, and that’s why it won our Editor’s Choice award.

Read: AMD Radeon RX 9060 XT 16GB review

6. The best graphics card for 1080p gaming: Nvidia GeForce RTX 5060, $369.99

If you want to get your game on at 1080p, we think the RTX 5060 is still your best bet in mid-2026. The midpoint of RTX 5060 prices is around $370 right now thanks to the AI crunch, but you can still find them for as little as $350 if you're willing to shop around.

The RTX 5060 has impressive baseline performance for 1080p gaming in wildly popular titles like Fortnite, Counter-Strike 2, Marvel Rivals, and Apex Legends that aren't hungry for giant pools of VRAM. And if you are trying to push higher output resolutions in demanding AAA games, the universal availability of DLSS 4.5 upscaling means that it's easy to achieve near-native image quality at lower input resolutions than before, making the RTX 5060 a more flexible performer than ever.

If you can tune your settings right, enabling DLSS 4 Multi-Frame Generation could make for an even smoother ride on this card, but we find that 8GB of VRAM isn't enough to consistently enable framegen in the titles where you'd really want it. The feature often doesn't work if you're already at the limits of the RTX 5060's memory pool (or that of any 8GB Blackwell card), since the MFG AI model needs some VRAM of its own to run.

AMD's toughest competition for the RTX 5060 is the RX 9060 XT 8GB, which also lists for $299 but is now selling for about the same $350 as you'll see RTX 5060s going for. Supply of those cards has largely dried up in mid-2026, however, and you're likely to see only a couple options for them from any e-tailer.

Despite its much-maligned 8GB of VRAM, the 9060 XT 8GB put in a strong showing in our 2026 GPU Hierarchy testing, but not consistently enough to beat out the RTX 5060 and take home our general recommendation.

When the RX 9060 XT can bring its full compute horsepower to bear in certain games, it can handily outpace the RTX 5060, so it's worth checking out results like those from our RX 9070 GRE review and seeing whether a game you love benefits from the Radeon's raw muscle.

But if you want a more consistently solid gaming experience, we'd still recommend the RTX 5060.

Read: Nvidia GeForce RTX 5060 Ti review

7. The best graphics card, period: GeForce RTX 5090, $4299

There's nothing else like the GeForce RTX 5090. If you want to turn on every bell and whistle in modern games at 4K (or beyond), the RTX 5090's sheer shader and Tensor Core horsepower, along with support for Nvidia's DLSS 4 upscaling and multi-frame generation, lets you tune your gaming experience to perfection even on high-refresh-rate 4K displays.

If you're a hardcore PC gamer who demands only the best, the hair will stand up on the back of your neck when you watch the RTX 5090 breeze through workloads that other graphics cards leak out all their thermal gel about.

Prices for the RTX 5090 have always been elevated, but they're stratospheric in early 2026. Major e-tailers only have a few different models listed, and prices start at $3500 or so and only go up from there. Nvidia's $1999 MSRP is pure imagination in current market conditions.

At those prices, an RTX 5090 is an indulgence of the highest order, but then again, it always has been. Without a compelling AMD alternative even on the horizon, considerations of value don't really apply here. If you truly need (or want) this class of gaming or AI performance, you're going to have to pay up.

This card needs a system with a massive power supply, one of our best gaming CPUs, and a top-shelf monitor to take full advantage of its astounding capabilities, and all those spendy components add up quick. But if you have a big enough bankroll to consider shopping for a graphics card of this caliber, you probably don't need us to tell you all that.

If Nvidia and its industry partners fixed the meltdown-prone ATX12V-2x6 connector, the RTX 5090 would be as close to gaming perfection as any graphics card that's ever been made. Guess that's something to improve on the RTX 6090, if it ever arrives.

Read: Nvidia GeForce RTX 5090 Founders Edition review

8. The cheapest graphics card worth buying: GeForce RTX 5050

If you have to save every penny on a new graphics card in 2026, you're hard up for good budget options. We previously recommended Intel's Arc B570 here, but after completing our 2026 GPU Hierarchy retesting, we're bumping it in favor of the RTX 5050, which is currently selling for about $300, or about $50 more than the B570.

Here's why: we think if you're spending any amount of money on a graphics card, it should just work. You should expect consistent feature support over time in games, universal support for upscaling and (optionally) frame generation when you need them, and consistently high performance in games.

The RTX 5050 unreservedly checks all those boxes, while we couldn't even complete our testing of the Arc B570 (or B580) for our 2026 GPU Hierarchy until the literal day before this guide update goes live, due to a months-long settings lockout with UE5's Nanite and Lumen in a little title you may have heard of called Fortnite.

We can't say when a similarly major issue might occur again with the Arc B570 in any game, and so we're no longer recommending it. Unless you're willing to gamble and need to save every possible dollar on a graphics card, we think you should just save up a bit more cash and buy an RTX 5050.

The RTX 5050 isn't the fastest GPU around, to be sure, and its 8GB of VRAM is a constraint for anything beyond 1080p gaming in mid-2026. But it delivers solid enough native raster performance at 1080p, and it beats out the Arc B570 even before you enable DLSS 4.5 upscaling. And if you do want the performance boost of DLSS, you're getting access to the best and most widely adopted upscaler on the market.

On top of that, the extra $50 over the Arc B570 means that you have the full strength of Nvidia's developer relations team and software support behind you when you go to play the latest games, and we think that reliable software support makes all the difference between a GPU that's fun and affordable and one that's merely cheap.

Read: GeForce RTX 5050 review

How we test the best graphics cards

Determining pure graphics card performance is best done by eliminating all other bottlenecks — as much as possible, at least. To that end, we've selected components for our test rig , most notably AMD's Ryzen 7 9800X3D CPU, one of the best CPUs for gaming.

We test across the three most common gaming resolutions, 1080p, 1440p, and 4K, using a mix of high and ultra settings, depending on the title. Where possible, we use 'reference' cards for all of these tests, like Nvidia's Founders Edition models and AMD's reference designs. Most midrange and lower GPUs don't get reference models, however, and in some cases we only have factory-overclocked cards for testing. We do our best to select cards that are close to the reference specs in such cases.

For each graphics card, we follow the same testing procedure. We run one pass of each benchmark to "warm up" the GPU after launching the game, then perform our actual test runs across each resolution.

We carefully review our test data and check for anomalies. For example, we always expect the RTX 5080 to be faster than the RTX 5070 Ti. If it's not, and we're not in a CPU limited situation, we'll recheck both cards to ensure that our standings our accurate. We also check and retest in cases of subtler issues, as when a transient hitch or frame-time spike causes a large dip in 1% low FPS.

Due to the length of time required for testing each GPU, updated drivers and game patches inevitably come out that can impact performance. We periodically retest a few sample cards to verify our results are still valid, and if not, we go through and retest the affected game(s) and GPU(s). We may also add games to our test suite over time, if one comes out that is popular and conducive to testing. See what makes a good game benchmark for our selection criteria.

Best graphics cards performance results

Our updated test suite of games consists of 19 games at present, eight of which have ray tracing enabled (or require RT to run at all).

We test without any upscaling or frame generation technologies enabled. We expect that most gamers will want to enable these features, but they complicate apples-to-apples comparisons between GPU vendors due to inherent differences in output image quality. To keep it simple, we present native resolution performance as a baseline.

The data in the following charts is from testing conducted during the past several months. We've tested all of the latest GPUs at every resolution and setting, even where it generally doesn't make sense (e.g. 4K with ray tracing at single digit framerates).

For each resolution and setting, the first chart shows the geometric mean (i.e. equal weighting) for all tested games. The second chart shows performance in the 11 pure raster games, and the third chart focuses in on ray tracing performance in eight games.

The charts below contain all the current Nvidia RTX 50-series and AMD RX 9000-series graphics cards. We're leaving Intel Arc cards out of the standings for now due to software compatibility issues with our test suite, and we'll include those results when those issues are corrected and we have the opportunity to retest them.

Our GPU benchmarks hierarchy contains additional data for every GPU spanning multiple generations of hardware. The charts are color coded with AMD in red, Nvidia in blue, and Intel in gray to make it easier to see what's going on.

The following charts are up to date as of June 2026.

Best Graphics Cards — 1080p

Best Graphics Cards — 1440p

Best Graphics Cards — 4K

Additional Shopping Tips

When buying a graphics card, consider the following:

• Monitor Resolution: The more pixels you're pushing, the more performance you need. You don't need a top-of-the-line GPU to game at 1080p, but you will certainly want more power at 1440p or 4K.
• PSU: Make sure that your power supply has enough juice and the right 6-, 8- and/or 16-pin connector(s). Nvidia, AMD, and Intel board partners will all make PSU recommendations alongside their products that you can use as a baseline, so if you're unsure whether your PC can provide enough power, be sure to check those spec sheets first. If you have an older PSU, be mindful that power supplies do lose capacity with time, so if you're contemplating a high-end GPU, it might be time to upgrade your GPU, too.
• Video Memory: In 2026, 8GB of VRAM is the bare minimum you'll want to play the latest games at 1080p, and it's the smallest amount of memory you'll find on a new card. Midrange cards tend to feature 12GB of VRAM, which is generally enough for raster gaming all the way out to 4K but may present limitations for RT even at 1440p. If you're planning to push a 4K display without upscaling or want to explore RT gaming without restriction, we recommend a 16GB card.
• FreeSync or G-Sync? Either variable refresh rate (VRR) technology will synchronize your GPU's frame delivery with your screen's refresh rate. Nvidia supports G-Sync and G-Sync Compatible displays (for recommendations, see our Best Gaming Monitors list). And most every G-Sync Compatible display also supports AMD FreeSync these days, so this vendor war is largely over.
• Upscaling and Frame Generation technologies: Nvidia's DLSS is in practically every game, and the latest DLSS 4.5 tech provides high-quality upscaling and frame generation (on RTX 40-series to boost performance to taste with practically no loss of image quality. AMD FSR 4 provides AI-enhanced upscaling on RX 9000-series cards, and a version compatible with RX 7000-series cards arrives in July 2026. Intel XeSS can deliver better image quality than older versions of FSR, but the core upscaler hasn't been updated in some time, and it's not as widely adopted as either DLSS or FSR, so it shouldn't influence your buying decision either way.

Finding Discounts on the Best Graphics Cards

While deep discounts are rare on graphics cards in 2026, you might find some particularly tasty deals on occasion. Check out the latest Newegg promo codes, Best Buy promo codes and Micro Center coupon codes for potential savings.

Want to comment on our best graphics picks for gaming? Let us know what you think in the Tom's Hardware Forums.

MORE: HDMI vs. DisplayPort: Which Is Better For Gaming?

MORE: GPU Benchmarks and Hierarchy

GuruFocus reports that Nvidia is reportedly considering using Intel Foundry's manufacturing services for GPUs aimed at gamers. Timothy Arcuri, an analyst with UBS, is quoted as saying that if Intel lands an order from Nvidia, one of the biggest fabless chip designers, this would be a major win and perhaps an inflection point for Intel Foundry.

According to the analyst, Broadcom and Nvidia—two AI chip powerhouses—are considering using Intel's 18A (1.8 nm-class) process technology for their products. However, Arcuri claims that Nvidia is 'closer' to adopting Intel as its second (or third?) supplier than Broadcom. AMD has also demonstrated interest in this manufacturing process, though its progress with this node is unclear.

"Intel is working to finalize commitments from Nvidia or Broadcom to use its foundry services," Arcuri reportedly wrote in a note to clients.

In addition to 18A, Intel is prepping its performance-enhanced 18A-P fabrication technology, which promises to either increase performance at the same power, or decrease power at the same performance. The analyst believes this production node could appeal more to external customers who want to maximize their performance while minimizing power consumption.

While vanilla 18A manufacturing technology could be a very good choice for Intel, which needs to roll out its next-generation Panther Lake processors for client PCs and Xeon 7 'Clearwater Forest' CPUs for datacenters as soon as possible, fabless chip designers may opt for performance-enhanced version of the process, just like they do with TSMC. By doing so, they get higher performance or lower power and a bit more mature fabrication technology with lower performance variability, lower defect density, and potentially higher yields.

Timothy Arcuri wrote in a note to clients that Intel's new chief executive, Lip-Bu Tan, will emphasize the company's chip design and foundry capabilities in the near term, which is something that both former CEO Pat Gelsinger and interim co-CEOs already did. The comment highlights that for now there is little understanding about Lip-Bu Tan's plans outside of the company.

Lip-Bu Tan will make his first public address as CEO of Intel on March 31 at the company's Vision event in Las Vegas. The event is mostly aimed at analysts and investors.

Dr Ann Kelleher, the executive vice president at Intel responsible for developing Intel’s fabrication technologies since 2020, announced plans to retire sometime later this year after three decades at the company, Intel told Tom's Hardware.

The announcement comes five months after the company had revealed a succession plan. Kelleher will stay on as an advisor.

Kelleher will be succeeded by Naga Chandrasekaran, who will be responsible for the development and implementation of semiconductor manufacturing processes. Navid Shahriari will be responsible for various back-end operations, such as advanced packaging. Kelleher will serve as a strategic adviser on technology development and production.

"As previously announced, Dr. Ann Kelleher plans to retire later this year following a distinguished career spanning over 30 years with Intel," a statement by Intel reads. "With a strong foundry leadership team in place and Intel 18A progressing well ahead of our first product launch and external customer tape-outs, this is a well-planned transition as we continue to advance our Foundry priorities in service to customers." 

New appointments and new management structure

Naga Chandrasekaran has been appointed to a newly established position as head of technology and operations at Intel Foundry, where he will oversee front-end process technology development and manufacturing. In this capacity, he will be in charge of both the Technology Development (TD) group and the Foundry Manufacturing and Supply Chain (FMSC) organization (which he has been overseeing since mid-2024).

Chandrasekaran comes from Micron, where he was in charge of global technology development, advanced packaging, and emerging technology solutions. Intel says he played a key role in unifying technology development and production teams to function as a single, cohesive unit.

With this appointment, Intel is looking forward to integrating TD and production under one leadership, possibly to ensure fast ramps, low defect density (high yields), and low performance variability.

Navid Shahriari — who was meant to succeed Kelleher at Process Development (PD) — was named executive vice president and will lead a newly created organization focused on back-end chip production. In his new role, he will be overseeing the organization that includes Assembly Test Technology Development (ATTD), Die Manufacturing/Manufacturing Operations (DMO), Assembly Test Manufacturing (ATM), and C4 Wafer Sort operations. 

By putting Shahriari in charge of the organization, which spans from development to manufacturing, Intel is likely emphasizing advanced packaging/assembly as a strategic differentiator. That means Shahriari will focus on developing new multi-chiplet integration technologies and getting them from lab to fab as quickly as possible.

Shahriari’s new role ties back to his TD roots, so his deep experience in process engineering and technology development could be instrumental in guiding how advanced R&D translates into high-volume production.

After setting the stage for future nodes, Kelleher will serve as adviser

Ann Kelleher's departure marks a major shift in leadership as Intel is about to start production on its 18A process technology, which is Intel's first leading-edge node designed for both its own products and external customers. 

By now, Intel has probably completed all the R&D work not only for its 18A-P, 3-E, and 3-PT process technologies that will succeed 18A and expand applications for Intel 3 nodes, but has completed the majority of R&D milestones for 14A (1.4nm-class), the company's next-generation leading-edge manufacturing node. In fact, scientists and engineers at Intel are hard at work on post-14A fabrication processes. To summarize, Kelleher has set the stage for Intel's technology development for years to come. However, her succession plan announced last year will change significantly.

Before Ann Kelleher leaves Intel later this year, she will serve as a strategic adviser to Intel Foundry and its differentiated technology development offerings, chiplet standards, and software, as well as U.S.- and Europe-based capacity. Ann Kelleher became the head of technology development at Intel in 2020 and completely rebuilt the whole organization to support Pat Gelsinger’s extremely aggressive 5N4Y roadmap to develop five new production nodes in four years. Before that, she was responsible for Intel’s worldwide manufacturing operations. Hence, she will advise on both technology development and production capacity.

Jensen Huang, chief executive of Nvidia, confirmed at GTC 2025 that the company plans to spend hundreds of billions of dollars on chips made in the U.S. over the next four years, reports the Financial Times. This decision comes as the company works to lessen its reliance on Asian manufacturing due to potential tariffs under the Trump administration and geopolitical instability surrounding Taiwan. The company is also producing Blackwell systems in the US.

Nvidia to spend hundreds of billions on American chips

"We are in it," Huang said at a GTC press conference, answering a question about production at TSMC Arizona, reports Reuters. "We are now running production silicon in Arizona." Huang also confirmed to the Financial Times that Blackwell systems are being produced in the US.

Huang did not elaborate on which chips are being manufactured at TSMC’s Fab 21 in Arizona, nor did he disclose volumes that Nvidia is producing there. The phrase ‘running production silicon’ means that actual chips (not test or prototype chips) are being manufactured. It does not necessarily imply high-volume production.

But while the volumes of Nvidia’s chips made in the U.S. remain unclear, Nvidia is set to increase manufacturing in America over the course of the next four years.

“Overall, we will procure, over the course of the next four years, probably half a trillion dollars’ worth of electronics in total,” Jensen Huang told the Financial Times. “And I think we can easily see ourselves manufacturing several hundred billion of it here in the U.S.”

It should be noted that while unit sales of discrete GPUs for client PCs are generally decreasing, the die sizes of flagship graphics processors are increasing, so the silicon real estate that Nvidia produces is also expanding. Additionally, sales of Nvidia’s gigantic data center GPUs are on the rise, and the company expects this to continue for the next several years. Therefore, it is not surprising that the company plans to spend roughly $500 billion on chips in the next four years.

Nvidia is mostly known for its GPUs for client PCs and data centers. In addition to GPUs, Nvidia also designs its own CPUs, DPUs, NVLink switches, networking chips, and system-on-chips (SoCs) for vehicles as well as various embedded applications. The vast majority of Nvidia’s silicon is produced by TSMC, though some chips are made by other foundries.

However, Nvidia’s products and Nvidia-based products also use numerous other chips not designed by Nvidia or produced by TSMC.

For example, the company uses CPUs developed by AMD and Intel, as well as GDDR and HBM memory made by Micron, Samsung, and SK hynix. It also uses a variety of components from other suppliers, including retimers, system management controllers, clock generators, power management ICs, analog devices, and various controllers/microcontrollers, to name a few.

Companies producing memory (Micron, SK hynix) and other components (Analog Devices, GlobalFoundries, Texas Instruments) are all building new production capacity in the U.S. (Micron’s fab is coming online in 2027, SK hynix is expected to follow in 2028, and TI’s SM1 fab is expected to be operational in 2025).

As a result, Nvidia may increasingly source these components from American facilities. Furthermore, Nvidia’s next-generation x86 servers will use AMD or Intel CPUs that could be produced by either TSMC in Arizona or Intel in Arizona. 

That said, with the expanded production of semiconductors in the U.S., it would not be surprising if Nvidia spent several hundred billion dollars on silicon made in America in the coming years. However, a key question is whether by ‘hundreds of billions’ Jensen Huang meant closer to $125 billion or between $250 billion and $300 billion, as many new fabs in the U.S. are coming online in the latter half of the decade.

Jensen Huang, chief executive of Nvidia, stated that his company had not been approached to participate in a group effort to acquire a stake in a company that would operate Intel's foundry unit. He dismissed claims that Nvidia was working with industry peers and TSMC on such a deal at a press conference at GTC, reports Reuters. 

Separately, Paul Liu, a TSMC board member and the head of Taiwan's National Development Council, denied claims that the company is considering purchasing Intel's struggling foundry unit, reports DigiTimes.

"Nobody has invited us to a consortium," Huang said, according to Reuters. "Nobody invited me. Maybe other people are involved, but I do not know. There might be a party. I was not invited." 

While speaking to Taiwan's Legislative Yuan Economic Committee on March 19, Paul Liu stated that the acquisition of Intel Foundry has never been discussed at the board level and compared it to mixing two incompatible substances, something that one in the semiconductor industry can consider both figuratively as Intel and TSMC have vastly different corporate cultures and literally as the two companies use different chemical substances for manufacturing. As a result, industry experts believe such an acquisition would be more harmful than beneficial to TSMC.

Liu explained that stabilizing the company's most advanced production technologies already takes between 18 and 24 months. Exporting such a node to the the U.S. would add another year, making American operations three years behind those in Taiwan, according to Liu. He also addressed concerns about a possible second Trump presidency leading to a shift of Taiwan's semiconductor industry to the U.S., urging lawmakers to see the U.S. as a partner (which accounts for the lion's share of TSMC's revenue) rather than a competitor.

Earlier this year there were rumors that the U.S. government pushed TSMC to take over Intel Foundry and operate it. The plan involves Intel spinning off its Intel Foundry unit, which makes chips for itself and external clients. TSMC would acquire less than half of the new entity, while the remaining shares would go to industry partners. The list of industry partners included AMD, Broadcom, Nvidia, and Qualcomm, according to Reuters. However, speaking at the conference, Huang denied any involvement in discussions about a potential consortium to take control of Intel's fabs. 

For Nvidia, which produces billions of dollars worth wafers every year, a dual sourcing supply strategy could make sense. However, designing large AI/HPC GPUs for different process technologies used by Intel and TSMC would significantly affect Nvidia's costs. Investing in a fab joint venture would also be odd for the company, which started as — and remains — a fabless chip designer.

The talks reportedly started before TSMC's March 3 announcement of its $100 billion U.S. investment. This plan includes five additional Fab 21 modules, two advanced packaging facilities, and a research center. However, according to Reuters' own report, the conversations about the fab joint venture continued after the announcement as TSMC was seeking agreements with major fabless chip design companies. As a result, Taiwanese lawmakers raised concerns following such media reports and pressured Liu for clarifications.

The appointment of Lip-Bu Tan as Intel's chief executive has generally pleased investors and financial analysts, but employees expressed mixed feelings following Tan's initial address, in which he hinted at tough decisions ahead but offered limited clarity on his strategic vision, reports Oregon Live.

Tan, who reportedly stepped down from Intel's board last August because he expected then-CEO Pat Gelsinger to make Intel leaner, is widely expected to make significant job cuts to reduce costs.

Not enough clarity

During his introductory video call, Tan — Intel's first external CEO in its 57-year history —emphasized satisfying customers and shareholders. However, his appearance sparked some criticism, as he wore a shirt from his former company, Cadence Design Systems, instead of one carrying the Intel logo. He cautioned employees — many still unsettled by the recent job and spending cuts — that more difficult decisions were incoming. There are concerns that Tan, who reportedly stepped down from Intel's board last year due to frustration with internal inefficiencies, may push for more job cuts.

One major topic Tan avoided was whether Intel would separate its manufacturing operations from its chip design division. This issue has been a central debate among analysts and former board members. Instead, Tan reiterated his commitment to maintaining Intel's engineering strength as part of the company’s broader turnaround efforts. However, in a letter to employees preceding the call, he emphasized plans to work hard and build a world-class foundry, which may imply that Tan intends to keep the company unified for now.

"Together, we will work hard to restore Intel’s position as a world-class products company, establish ourselves as a world-class foundry and delight our customers like never before," Tan wrote. "That is what this moment demands of us as we remake Intel for the future."

Some employees felt that Tan's remarks lacked enthusiasm and specificity. They had hoped for a clearer strategic plan and stronger reassurance regarding the company's future direction, especially considering his alleged role on Intel's board of directors, which he left in August 2024.

Left with discontent

Tan joined Intel's board in 2022 as part of the company's effort to reclaim its position as a global leader in CPU design and manufacturing. Over time, his role expanded to include oversight of manufacturing operations.

However, eventually, Tan grew increasingly discontent with the company's 'bloated' workforce, which he felt was inefficient and overly bureaucratic, according to Reuters. One of Tan’s major concerns was Intel's approach to layoffs. While Intel announced cuts affecting over 15% of its workforce, Tan believed the reductions were insufficient and should have targeted middle management, which he viewed as a barrier to innovation. He was particularly frustrated that, despite the layoffs, Intel's workforce remained significantly larger than that of competitors like Nvidia and TSMC combined.

Another point of contention was Intel's foundry business. Tan was disappointed by the lack of progress in this area, particularly after a $5.4 billion deal to acquire Tower Semiconductor fell through due to regulatory hurdles in China. Without Tower, Intel lacks the expertise to succeed in contract manufacturing, where it has historically struggled. As a former CEO of Cadence who led the company for 12 years, Tan knows what fabless chip designers need, so now Intel has more chances in the area.

In addition to workforce and foundry issues, Tan was critical of Intel's lagging efforts in AI. Despite multiple attempts and acquisitions to strengthen its AI capabilities, Intel could not keep pace with Nvidia, which became a trillion-dollar company capitalizing on the AI boom.

Analysts and investors cheer

Despite internal worries, investors reacted positively to Tan's appointment. Intel's stock price surged by 15%, opening at $23.80 the following day. Analysts like Stacy Rasgon from Bernstein noted that Tan's longstanding experience in the semiconductor sector lends him significant credibility and could signal hope for Intel's recovery.

Industry analysts believe that Tan's deep-rooted connections and industry knowledge uniquely position him to make the decisions required for Intel's revival. That said, his leadership is seen as a potential catalyst for positive changes, though the path forward may need significant restructuring.

Although TSMC has committed to invest an additional $100 billion in its own Fab 21 campus in the U.S., a potential joint venture to run Intel's manufacturing capacity is still in the works, according to Reuters, citing four sources. TSMC would reportedly not own more than 50% of the proposed joint venture. A venture that would see leading American fabless chip designers — AMD, Broadcom, Nvidia, and Qualcomm — get stakes in the joint venture, which will be operated by TSMC.

The initiative emerged following a request from President Trump's administration, aiming to bolster Intel while ensuring continued American control. Under the terms of the proposed scheme, Intel will have to spin off its Intel Foundry (IF) division that produces chips for Intel and third-party customers, and then TSMC, the world's largest contract chipmaker, buys less than 50% of IF, leaving the rest to partners. TSMC reportedly initiated discussions with AMD, Broadcom, Nvidia, and Qualcomm, but the talks remain preliminary and sensitive, according to four anonymous sources familiar with these discussions. It is also noteworthy that TSMC has not pitched its main client, Apple, to invest in the JV.

The idea of such a collaboration aligns strategically with President Trump's goal to revive domestic advanced manufacturing, and reviving Intel is one of the administration's priorities. However, it is unclear whether splitting the company and handing its parts to TSMC helps with competition between foundries.

According to Reuters' sources, TSMC approached potential partners about the joint venture prior to its March 3 announcement of plans to invest an additional $100 billion in its U.S. manufacturing capacities, which includes the construction of five new Fab 21 modules over the next several years, building two advanced packaging facilities, and an R&D center. Discussions regarding the joint venture involving Intel's foundry division have continued since then, according to the three sources, with TSMC aiming to secure partnerships with multiple chip design companies.

Technical, operational, and business complexities present significant hurdles for the potential joint venture.

• According to an Intel filing with the SEC, Intel's manufacturing and real estate assets cost around $108 billion, so interested parties will have to invest tens of billions of dollars to get a sizeable stake in Intel Foundry.
• TSMC is unlikely to be interested in owning a 50% stake in a JV that uses its own process technologies and competes against the Taiwan foundry.
• Transferring TSMC's production nodes to Intel's advanced fabs with EUV tools is hard, if possible at all, as Intel and TSMC operate vastly different manufacturing processes, employing distinct equipment configurations and chemical substances at their respective fabs.
• Intel has fabs that can only produce chips using its own process technologies. These fabs — which cost tens of billions of dollars — will continue to serve Intel for a while, but they present little value for outside investors.
• It is unclear how operating a JV aligns with TSMC's own manufacturing operations in the U.S.

The news had immediate market implications. Intel's stock price rose more than 7% in pre-market U.S. trading following reports of this potential partnership, according to Reuters. However, it is unclear whether the aforementioned fabless semiconductor developers are interested in getting into manufacturing. All of them chose to be fabless because they did not want to get into a complex capital-intensive business, and it is unclear what could drive their interest towards putting tens of billions of dollars in a JV considering the fact that they already have pre-booked capacity at TSMC.

Although Intel would like to reduce its use of TSMC’s manufacturing services , the company will keep ordering chips from the Taiwan-based foundry for the foreseeable future, a high-ranking executive said at a technology conference yesterday. 

Intel’s grand plan is to produce as many products as possible internally at Intel Foundry, but as this may not be the most optimal strategy, it is currently assessing what percentage of its products should be produced at TSMC. 

"I think a year ago we were talking about trying to get [usage of TSMC] to zero as quickly as possible, but that is no longer the strategy," said John Pitzer, vice president of corporate planning and investor relations at Intel, at the Morgan Stanley Technology, Media & Telecom Conference. "We think it is always good to have at least some of our wafers with TSMC. They are a great supplier. This creates healthy competition between them and Intel Foundry." 

Intel currently produces silicon for its flagship Core 200-series ‘Arrow Lake’ and ‘Lunar Lake’ processors for desktops and laptops at TSMC and then assembles them using its Foveros 3D advanced packaging technology at its packaging facilities in the U.S. As a result, the company has to pay TSMC a premium, which significantly hurts its gross margins. 

With its next-generation Core 300-series ‘Panther Lake’ CPUs, Intel expects to use its own manufacturing facilities, including the most advanced Fab 52 and Fab 62 in Arizona, to make the compute chiplet of the processor using the company’s 18A fabrication technology. Since the majority of manufacturing operations will be performed internally, Intel expects to enjoy higher gross margins with its next-generation products. 

However, some of Intel’s products will continue to be made at TSMC. Currently, around 30% of Intel’s products are outsourced, but the company expects this share to decrease considerably in the future. 

"Not quite sure what the right sort of [outsourced production] level is," said Pitzer. "Is it 20%? Is it 15%? We are working through that. But we will use, I think, external foundry suppliers longer under this new strategy." 

Intel is, of course, interested in producing its most advanced high-margin products, such as Xeon processors that cost thousands of dollars each, internally. In fact, the company has never outsourced these parts. And clearly it would prefer not to outsource premium high-volume CPUs for client PCs.

However, Intel may use TSMC’s services to make niche products for client computers as well as various controllers that add tremendous value to Intel’s platforms but are sold for $10–$15.

Such controllers usually rely on trailing nodes that Intel currently lacks (since Intel’s 14nm and 22nm process technologies were designed for CPUs and use proprietary IPs). So the use of TSMC and other foundries to make them is a good fit.

A federal judge on Wednesday dismissed a lawsuit against Intel, which accused the company and its management of hiding financial troubles of its semiconductor manufacturing division in 2023, reports Reuters. The U.S. District Judge Trina Thompson in San Francisco ruled that plaintiffs failed to present evidence that Intel and its executives committed any wrongdoing. The case was dismissed without prejudice, meaning the plaintiffs can file an amended complaint with stronger evidence.

Plaintiffs had argued that Intel and its then-CEO Pat Gelsinger and then-CFO David Zinsner concealed a $7 billion loss of its Intel Foundry unit in 2023, which led to stock inflation as well as a consequent massive $32 billion drop of the company's market capitalization in April 2024, when the company disclosed losses of its newly formed Intel Foundry division for 2023 and Q1 2025.

Starting in Q1 2024, Intel implemented its 'internal foundry' model, making its product divisions and external clients purchase manufacturing and packaging services from Intel Foundry, a separate division within the company. Before this, Intel only reported results for Intel Foundry Services (IFS), which catered exclusively to external customers.

On April 2, 2024, Intel fully disclosed its segment reporting changes and had to recast past financials, revealing that Intel Foundry lost $7 billion in 2023. This revelation triggered a sharp decline in Intel's stock. The court determined this loss was not solely tied to Intel Foundry Services, the division responsible for making chips for outside companies, contradicting investors' claims, but was attributed to Intel Foundry, a division that worked with both Intel and external customers

The lawsuit also challenged statements by Gelsinger and Zinsner, particularly Gelsinger's claim of 'significant traction' and 'growing demand' for the foundry business. The court ruled these statements were not misleading because they referred to specific customer engagements rather than overall financial health of Intel and Intel Foundry.

Plaintiffs also pointed to Intel's 26% stock drop after announcing layoffs and a dividend suspension in mid-2024, claiming it was evidence of misleading practices. However, the court ruled that a stock decline alone is not proof of fraud, as Intel has always had competitive challenges and publicly discussed its cost-saving strategy and restructuring plans.

Although the lawsuit was dismissed, the judge will allow investors to revise their complaint and refile. Intel declined to comment on the ruling, while legal representatives for the shareholders did not immediately respond to inquiries.

Nvidia and Broadcom are both testing chips using Intel's new 18A manufacturing process, reports sources to Reuters, indicating that these well-known projects continue. Intel's 18A process is the company's first fabrication technology to rely on gate-all-around RibbonFET transistors and a backside power delivery network named PowerVia. The Intel 18A process is broadly comparable to TSMC's N2 node. However, 18A is thought to be faster, while N2 is a denser chip.

Reuters sources suggest that both Nvidia and Broadcom's tests are not being conducted on complete chip designs, but the companies want to understand how 18A works in both behavior and performance. It's common to test processors before committing to purchasing them outright.

This isn't entirely new information, as there have been reports that Broadcom had been testing 18A since as early as September 2024. Back then, it was claimed that Broadcom's tests using 18A did not meet expectations, but that was not confirmed, with Broadcom merely saying the tests were ongoing.

Nvidia CEO Jensen Huang has claimed as far back as 2022 that Nvidia would consider using Intel-fabricated chips, and noted the company had test chips under active testing in 2023. In 2024, Tom's Hardware quizzed Intel Foundry Services chief Stu Pann about the company's RAMP-C project, in which Nvidia is a formal partner. This program gives companies federal funding to build test chips on Intel's 18A process node for military applications.

Intel recently launched a dedicated website to advertise its 18A process, and consumer Panther Lake processors are set to enter mass production in mid-2025.

An Intel spokesperson told Reuters: "We don't comment on specific customers but continue to see strong interest and engagement on Intel 18A across our ecosystem."

While Intel's 18A process is reportedly garnering interest from big-name clients, Reuters claims to have reviewed supplier documents that indicate a problem with some unnamed third-party IP providers. Reuters claims this situation is causing "potential further delays in Intel's ability to deliver chips for some contract manufacturing customers" that could stretch the launch times for small and mid-size customers to mid-2026. Intel responded that it remains on track to begin fabricating chips in the second half of this year.

This is happening on the backdrop of a particularly difficult period for Intel, as the company lost $1.6 billion in 2024 and continues to struggle in its data center and foundry divisions. Former CEO Pat Gelsinger was ousted in December 2024, despite being one of the key people to lead Intel toward developing 18A, a product that could theoretically compete with TSMC's dominance.

Former Intel CEO Craig Barrett said on the matter: "In my opinion, a far better move might be to fire the Intel board and rehire Pat Gelsinger to finish the job he has aptly handled over the past few years.”

While Broadcom and Nvidia are likely to be testing 18A chips, Intel is in a position where it needs to lock down big clients for its next process node. Intel isn't expecting a quick pathway to profitability with its Foundry, as the company doesn't predict it will break even until 2027.

Intel's stock has surged over 20% recently as investors anticipate a possible company split amidst a rumor suggesting that the Trump administration might push Intel and TSMC to form a joint venture that would take over Intel's manufacturing capacity. Four former directors of Intel wrote a column in the Fortune magazine explaining that this is a terrible idea and proposed spinning off Intel manufacturing to a separate company that would be owned by American investors instead. 

Speculation has arisen that the new U.S. government might pressure Intel and TSMC to form a joint venture that would take over Intel's semiconductor production facilities, which are valued at approximately $108 billion. These facilities span multiple U.S. locations, including Arizona, New Mexico, and Oregon, with an additional site under development in Ohio. In addition, Intel has fabs in Israel and Ireland. The Trump administration has denied its involvement and said that it would not welcome a Taiwanese company taking over Intel fabs. TSMC's management also denied interest in taking control over Intel's manufacturing capacity. 

The old plan is bad

Former Intel directors David B. Yoffie (a professor at Harvard Business School, has an extensive background in high-tech business strategy), Reed Hundt (a former chairman of the FCC), Charlene Barshefsky (a lawyer and a former U.S. Trade Representative), and James Plummer (a professor of electrical engineering and former dean of the School of Engineering at Stanford University, has a rich semiconductor background and holds 20 appropriate patents), wrote a column for Fortune magazine condemning the idea of handling Intel manufacturing capacity to TSMC and calling to spin it off and sell to a group of Western investors.

A TSMC-controlled semiconductor industry poses significant risks. Concentrating leading-edge semiconductor production in the U.S. under a foreign entity could weaken American technology firms by creating a near-monopoly, the former directors believe. While companies like Apple, AMD, and Nvidia rely on TSMC today, they still benefit from competitive pressure on the market that is created by Samsung Foundry and will be supported by Intel Foundry if the latter is a success. Intel presents little competition for TSMC as it has only two production nodes to offer. However, if Intel disappears completely, American firms could face reduced bargaining power, the former directors suggest.

A proposed plan

The former Intel directors think that a more strategic approach would be for Intel to separate its manufacturing division from its design business. In fact, they go as far as saying that the U.S. government should require the company to spin off its production operations and sell them to a Western private investor group. To make this viable, Washington should provide $10 billion in capital as non-voting equity, similar to the 2008 bank bailouts, ensuring taxpayers benefit if the venture succeeds. Additionally, major U.S. semiconductor firms, including Intel's design division, must commit to placing orders to guarantee profitability. The former members of the Intel board of directors believe these measures would make the business attractive to investors while preserving American semiconductor production capabilities.

On paper, spinning off Intel's manufacturing operations to a separate company sounds like a plausible idea. However, significant technological and business barriers will likely prevent this from happening smoothly, if at all.

Intel's semiconductor production fab chain costs around $108 billion (maybe a bit less if we subtract the cost of office buildings and other non-production assets). Finding an investor willing to buy these manufacturing assets for their value will be hard, to put it mildly, as $100 billion M&A transactions are not common.

Of course, it would be easier to persuade a consortium of investors to invest in Intel Foundry if a group of leading American companies would commit to using its services for years to come. However, committing to an unknown Intel Foundry is a huge risk for companies like AMD, Apple, Intel, and Nvidia, as this might slow down their progress and hinder their growth. Something that happened to AMD's commitment to GlobalFoundries back in the day.

Analysis

The proposal to handle Intel's manufacturing facilities to TSMC completely omits that Intel has its own process technologies — Intel 14nm (and older), Intel 10SF/10ESF, Intel 4, and Intel 3 — and already makes chips in high volumes. Also, the company is about to launch high-volume manufacturing of its Panther Lake and Clearwater Forest, with its 18A process technology, and get third-party 18A tape-ins in mid-2025. Discussions about spinning off Intel's fabs to a separate entity run by TSMC would hurt Intel's negotiations with potential 18A customers.

But let's assume that Intel and TSMC agreed to form a joint venture to run Intel's fabs., and that Intel keeps making chips on its Intel 4, Intel 3, and 18A process technologies, but TSMC would like to also make chips on Intel's capacity as well. Transferring TSMC's fabrication technology to Intel's U.S. factories with EUV capabilities would be highly complex. Although both companies use EUV lithography, their equipment setups, fab configurations, and vendor-specific modifications differ significantly. ASML's lithography tools, for instance, are custom-calibrated for each company. Intel and TSMC also have distinct etching, deposition, and process control methods, all of which influence production tools.

A joint venture would hurt TSMC's profit margins. The only reason TSMC might consider working with Intel is if a Trump administration introduced tariffs forcing it to manufacture its advanced 3nm and 2nm chips in the U.S. However, Intel lacks sufficient EUV production capacity in the U.S. to meet demand for both its own products and those of TSMC's clients. Instead, TSMC is accelerating its own Arizona fabs to support 3nm and 2nm production, which is a more viable business strategy, as industry analysts have suggested.

Even if TSMC was compelled to take control of Intel's capacity, its most advanced research would remain in Taiwan, and over time, it might close Intel's factories and lay off most of its workforce.

It should be kept in mind that Intel also has non-EUV capacity designed to produce Intel's own products. TSMC will unlikely be able to port its nodes to production lines meant for Intel 14nm (and older) and Intel 10SF/10ESF (at least, not in a financially viable way). These production capacities are worth billions for Intel as they produce sellable products. For an external company (whether TSMC or a group of investors), they will unlikely pose that much value as Intel would remain the only customer for those nodes and fabs. Meanwhile, at some point, those fabs will either have to be upgraded (which means additional investments), or shut down (something that the former members of the board mentioned above), which means writing off billions of dollars.

Intel has revised the construction schedule for its Ohio One semiconductor manufacturing site in New Albany, Licking County, delaying its launch to the next decade. The first phase (Mod 1) will now be completed in 2030, with production starting between 2030 and 2031. Mod 2 is set to finish in 2031, with operations launching in 2032. The company is slowing down the facility's construction to align its investments with market conditions. However, Intel stressed that it could accelerate construction if needed.

Intel originally planned to complete the first phase of its Ohio site — once called the Silicon Heartland — in 2025. However, massive investments amid uncertain demand made Intel push the completion of the first module to 2027 or 2028. Now, the company believes it will need its fabs in Ohio only in 2030 and beyond. The delay suggests that it does not expect demand for its production capacity to skyrocket soon, which may be a not-so-positive development. On the other hand, Intel will also not have to invest heavily in its Ohio site now, which is good news for the company's balance sheet as it is struggling to return to profitability. Investments in production equipment are the most significant investments in semiconductor fabrication facilities, so by delaying them, Intel significantly cuts its capital expenditures for the 2025 – 2028 period.

The upcoming campus will cover approximately 1,000 acres (4 square kilometers), accommodate up to eight semiconductor fabrication plants, and foster space for support operations and industry partners. Intel previously estimated that fully developing the site would require an investment of around $100 billion. The first round of investments was set at around $28 billion.

Given the new schedule for the Ohio One (or the Silicon Heartland?) fabs, expect the new facilities to use process technologies that the company will develop after its 14A and 14A-E, currently set for 2026 – 2027 introduction. These nodes will rely on ASML's Twinscan EXE:5200 or more advanced High-NA EUV tools that cost $350 million per unit.

"We are taking a prudent approach to ensure we complete the project in a financially responsible manner that sets up Ohio One for success well into the future," wrote Naga Chandrasekaran, executive vice president, chief global operations officer and general manager of Intel Foundry Manufacturing, in a message to employees. "We will continue construction at a slower pace, while maintaining the flexibility to accelerate work and the start of operations if customer demand warrants, but I want to be upfront and transparent with you all about our current plan."

Intel began work at the site in 2022. Since then, construction at the site has advanced significantly. The project recently reached a milestone as the underground foundation was finished, and construction above ground has begun. According to Intel, since the beginning of the construction, the site has accepted 36 superloads (through February 4), including four extra-large superloads containing the fabs' air separation units. More than 6.4 million labor hours have been invested, covering key installations such as underground piping, 200,000+ cubic yards of concrete, and sub-utility trenches (SUTs). Office structures are also taking shape.

One interesting thing about the Ohio fab is that despite the revised timeline, hiring has already begun, with Ohio employees training in Arizona, New Mexico, and Oregon ahead of the local facility's launch. Presumably, Intel is training employees to install production tools and other machinery. Workforce initiatives are set to expand as operational dates approach.

The rumors about Intel and TSMC forming a semiconductor production joint venture have spurred significant reactions among analysts, the industry, and politicians. Needless to say, it was natural for Intel employees to react to the information, too. Joseph Bonetti, Principal Engineering Program Manager at Intel Corp., wrote his personal opinion in a LinkedIn post that the company is about to reclaim its process technology lead and gain customers among fabless chipmakers in the coming years, so handing TSMC control of Intel's manufacturing would be counterproductive (Edit: the post has now been deleted).

"Intel Leaders, Intel Board, Trump Administration, please do not sell out and/or give control of Intel Foundry to TSMC, just as Intel is taking a technical lead and getting out of first gear. This would be a horrible, demoralizing mistake," wrote Bonetti.

Contrary to reports suggesting it lags behind a key competitor, Bonetti argues, Intel is making significant advancements in semiconductor manufacturing. The company's latest fabrication process, Intel 3, is already used to make Xeon 6 data center processors, while the company's next-generation Intel 18A is nearing completion and is expected to be used to make Panther Lake processors for client PCs later this year. Meanwhile, TSMC's equivalent process technology — N2 (2nm-class) — will only enter mass production phase in late 2025.

Intel is also ahead with its High-NA EUV initiatives. The company acquired two ASML Twinscan EXE machines and is the only chipmaker that has experience working with such tools. Despite financial struggles, Intel Foundry is poised to prove itself with major partners, which makes any potential deal that hands control to a rival a major strategic error.

Many claims in recent reports misrepresent Intel's progress, stresses Bonetti. Some suggest TSMC engineers are needed to get Intel's latest process technologies to work, but Intel 3 has been in mass production for months, and Panther Lake, made on Intel 18A, is already sampling with laptop manufacturers.

Intel 18A and TSMC N2 both introduce gate-all-around transistors, but Intel's fabrication process includes an additional breakthrough: backside power delivery, which promises to improve efficiency and performance and give Intel's products an edge over those made by TSMC.

The Intel engineer reckons that Intel Foundry is currently unprofitable due to massive investments in facilities and equipment, and it has yet to win contracts from major external customers. However, early adoption by Microsoft and Amazon signals confidence in Intel's capabilities. If these efforts succeed, more industry leaders may shift production. To that end, ceding control of Intel Foundry to TSMC would neutralize Intel as a competitor and harm U.S. leadership in the semiconductor industry.

Intel is facing potential acquisition bids from TSMC (Taiwan Semiconductor Manufacturing Company) and Broadcom, according to sources cited by The Wall Street Journal. The two major tech companies are exploring deals that could effectively split Intel's operations, with Broadcom reportedly eyeing Intel’s chip design and marketing divisions, while TSMC is assessing the possibility of taking over its chip manufacturing plants.

Broadcom has engaged in informal discussions with advisors about a potential bid, though it is likely to proceed only if it secures a partner to handle Intel’s manufacturing segment. This approach aligns with Broadcom’s ongoing strategy of expanding its business through targeted acquisitions. Meanwhile, TSMC, the world's largest contract chip maker, is reportedly considering forming an investor consortium to acquire Intel’s fabrication plants, which would further strengthen its position in the global semiconductor market. All discussions remain preliminary, and no formal offers have been made.

Intel has been struggling to regain its foothold in chip manufacturing amid increasing competition from TSMC and others. Pat Gelsinger, the company’s previous CEO, was ousted in December after a series of setbacks including delays in manufacturing plans, a decline in AI chip market share, and a reliance on government subsidies to fund factory expansions. Intel’s financial struggles, including $7 billion in losses from its chipmaking segment in 2023 and a 60% decline in share price, have made it an acquisition target.

Any potential deal faces a major roadblock, however: U.S. government opposition. The Trump administration has voiced strong concerns over the possibility of a foreign company operating Intel’s U.S.-based chip fabs. A White House official recently stated that while foreign investment is generally encouraged, Intel’s domestic manufacturing capabilities are seen as strategically important, making it unlikely that a takeover by TSMC would receive government approval.

This stance complicates any potential deal, especially as the U.S. government has been actively subsidizing domestic semiconductor production to reduce reliance on foreign chip makers. If Broadcom and TSMC move forward with their plans, they may need to navigate regulatory hurdles and find domestic partners to satisfy national security concerns.

A breakup of Intel would mark a shift toward specialization, with companies focusing on either chip design or manufacturing. Whether these acquisition talks gain momentum or stall due to political and economic factors remains to be seen.

A Wall Street analyst's speculation suggests that the U.S. government is pushing Intel and TSMC to form a joint chip production venture, which would be owned by the two companies and operated by TSMC.

According to a Wall Street Journal report, the U.S. government wants TSMC to apply its experience with high-volume manufacturing using EUV lithography to Intel's process technologies. Another rumor cited by the Financial Times points to TSMC's accelerated Arizona Fab 21 complex expansion.

A weird rumor

"There are discussions from the Asia supply chain that the U.S. government will get involved in potentially the following: TSMC would send engineers to Intel's 3nm/2nm fab, applying the company's know-how to ensure that the fab and subsequent manufacturing projects from Intel become viable," Tristan Gerra, an analyst with Baird, wrote in a note sent to clients (via @WallStEngine). "The fab could be spun off into a new entity jointly owned by TSMC and Intel, and run by TSMC. The new entity would receive U.S. Chip Act funding."

Although Tristan Gerra admits there are no confirmations of the rumors and that the project could take a long time to materialize, the strategy apparently appears logical to analysts. If implemented, Intel's financial pressures would be eased, and it could shift its focus toward chip architecture and platform solutions. Also, Intel would retain its manufacturing capacity, aligning with the strategy set by former chief executive Pat Gelsinger. Additionally, an operational and competitive fabrication facility could draw major chip designers seeking a stable and geographically secure manufacturing alternative, which would ensure the utilization of the fab.

The rumor is odd, raising both business and technology concerns. Let’s start with the technology — two ways for semiconductor producers to “share know-how” would be by helping each other tune equipment for a particular process technology (or technologies, as Intel 3-capable fabs are likely also capable of 18A), or porting an established production node to a new fab.

Technology concerns

TSMC engineers are unfamiliar with Intel’s EUV-based fabrication processes and process recipes, so their ability to tune anything will be limited, or take months. Meanwhile, Intel’s 3nm node is in mass production, and the 18A manufacturing technology will enter high-volume manufacturing a few months later. Based on what Intel says about 18A, this process does not need further tuning, especially not adjustments made by external engineers.

Porting TSMC’s fabrication technologies to an Intel fab in the U.S. is challenging. Even though Intel and TSMC fabs might use EUV lithography, each has unique tool setups, fab configurations, and vendor-specific modifications. For example, ASML’s lithography machines typically feature custom calibrations and/or additional modules that suit the chipmakers' respective processes. Also, Intel and TSMC have different etch recipes, deposition sequences, and step-by-step controls, which usually affect tools.

Fabrication processes depend on carefully vetted materials with strict purity and composition requirements. Even small changes in photoresist or etch chemistries can introduce defects or cause process drift. Moreover, TSMC’s approved chemical suppliers and their formulations differ from Intel’s, and it is not guaranteed that the raw materials used by TSMC can effectively be used on Intel’s tools.

Even minor variations in temperature controls, gas flows, or photomask handling can cause significant drift in line widths, transistor characteristics, and yields, making porting complex, expensive, or financially unfeasible.

Business concerns

On the business side of the issue, TSMC has no interest in helping Intel improve its EUV fabrication technologies as Intel is a rival. The company also does not need to form a joint venture with Intel, as it could impact its gross margins. The only motivation for TSMC to work with Intel would be to avoid potential tariffs introduced by the Trump administration, which could require TSMC to produce advanced chips on its N3 (3nm-class) and N2 (2nm-class) process technologies in the U.S.

However, Intel is unlikely to have enough EUV production capacity in America to meet demand for its products and products from TSMC’s customers. To that end, accelerating the adoption of N3 and N2 in TSMC's own Arizona fabs, as reported by the Financial Times citing industry analysts, makes far more business sense.

For Intel, working with TSMC also seems impractical. It is unlikely that TSMC engineers can help significantly improve Intel 3nm and 18A process technologies. However, porting TSMC nodes to fabs in the U.S. means that Intel’s fabs in Ireland and Israel would be the only facility to use Intel’s nodes.

Yet, it is unlikely that these sites will be financially viable in the long run, as process technologies cost billions to develop, and the more chips a company produces using a single node, the better. For obvious reasons, TSMC is hardly interested in porting its advanced nodes to Intel facilities in Ireland and Israel, even as part of a joint venture, as this could create overcapacity for its fabrication technologies.

Thoughts

Ongoing geopolitical turmoil, coupled with Intel's financial and execution struggles, have generated various rumors surrounding the blue giant. In this case, significant technological and business hurdles — ranging from differences in tooling process recipes at Intel and TSMC to TSMC's lack of incentive to aid a competitor — cast doubt on the feasibility of such a partnership.

TechInsights and SemiWiki have published key details that Intel and TSMC disclosed about their upcoming 18A (1.8nm-class) and N2 (2nm-class) process technologies at the International Electronic Devices Meeting (IEDM). According to TechInsights, Intel's 18A could offer higher performance, whereas TSMC's N2 may provide higher transistor density. 

Analysts at TechInsights believe that TSMC's N2 offers a high-density (HD) standard-cell transistor density of 313 MTr/mm^2, which far exceeds the HD cell density of Intel's 18A (238 MTr/mm^2) and Samsung's SF2/SF3P (231 MTr/mm^2). While the information more or less aligns with SRAM cell sizes for 18A, N2, and N3, as well as with TSMC's expectations for N2 and N3, there are some things to note. 

First, this only concerns HD standard cells. Virtually all modern high-performance processors that rely on leading-edge nodes use a mix of high-density (HD), high-performance (HP), and low-power (LP) standard cells, not to mention capabilities like TSMC's FinFlex and NanoFlex. 

Secondly, it is unclear how Intel's and TSMC's HP and LP standard cells compare. While it is logical to assume that N2 has a transistor density lead, it may not be as massive as the lead in HD standard cells. Third, in their papers presented at the IEDM event, both Intel and TSMC disclosed performance, power, and transistor density advantages of their next-generation 18A and N2 manufacturing processes over their predecessors. Still, there is currently no way to compare these two fabrication technologies head-to-head. 

When it comes to performance, TechInsights believes that Intel's 18A will have a lead over TSMC's N2 and Samsung's SF2 (formerly known as SF3P). However, TechInsights uses a debatable method to compare the performance of the upcoming nodes, as it uses TSMC's N16FF and Samsung's 14nm process technologies as baselines and then adds announced node-to-node performance improvements from both companies to make its prediction. While this might serve as an estimate, it may not be entirely accurate. 

On the other hand, Intel specializes in making high-performance processors, so 18A could be tailored for performance and power efficiency rather than HD transistor density. At the end of the day, 18A supports PowerVia, a backside power delivery network, and chips that use it might have performance and transistor density advantages over TSMC's N2, which does not support this capability. However, this does not mean that every 18A chip will use PowerVia. 

When it comes to power, TechInsights analysts presume that an N2-based chip will consume less power than a similar SF2-based IC, as TSMC has typically led in power efficiency in recent years. As for Intel, this remains to be seen, but at least 18A will provide an advantage in this area. 

There are a couple of other things to note. Intel's 18A is set to enter mass production in mid-2025 when Intel begins production of its Core Ultra 3-series ‘Panther Lake' processors, which will be available later this year. By contrast, TSMC's N2 is slated for high-volume manufacturing in late 2025, and the first products produced on this node will not be available until mid-2026 at the earliest, with mass-market products expected in Fall 2026. Samsung does not disclose when exactly its SF2 enters HVM, only stating '2025,' which could mean any time from Q1 to Q4 this year.

When Apple began to build its own processors for iPhones and iPads in 2009 – 2010, it initially used Samsung Foundry, but after custom silicon became a key advantage of iPhones over rivals in the early 2010s, the company began to explore other makers as Samsung was Apple's primary rival at the time. The company considered using Intel Custom Foundry (ICF) and Texas Instruments but quickly realized the ICF was not tailored for external customers at all, while TI did not have advanced process technologies. As a result, it chose TSMC as its exclusive supplier, according to Morris Chang, the founder of TSMC, who spoke to Acquired. 

"The [CEO] of Intel has approached Tim Cook and has asked Tim Cook to consider Intel, and at this time, Intel was the major supplier for Apple's Mac line," Chang reminisced. "I knew a lot of Intel's customer customers in Taiwan […] none of them liked Intel [as it] always acted like they were the the only guy [with] microprocessors. […] The Foundry business where TSMC […] does not compete with customers and even if Intel is trying to do business in good faith they do have the conflict [of interests." 

When Intel's CEO Paul Otellini approached Tim Cook in early 2011, offering to manufacture Apple's chips, Apple paused discussions with TSMC for two months to evaluate the proposal.

Morris Chang, concerned about this pause, traveled to Apple's headquarters to check on the situation. In a private meeting, Tim Cook reassured Chang that Apple would not choose Intel. 

"Intel just does not know how to be a foundry," Tim Cook reportedly told Chang. 

The implication was that Intel lacked the customer-centric mindset required for a foundry business. Unlike TSMC, which tailors its process technologies to meet customer needs, Intel was used to designing and producing its own chips and struggled to adapt to servicing external clients. By contrast, Apple valued TSMC's ability to listen and respond to specific demands, something Intel historically did not do. 

"When the customer asks a lot of things, we have learned to respond to every request," Chang said. "Some of them were crazy, some of them were irrational, [but] we respond to each request courteously. […] Intel has never done that, I knew a lot of customers of Intel's here in Taiwan and all [of them] wished that there were another supplier." 

However, it is notable that Intel has worked to defray those concerns with its now-revamped Intel Foundry, which also now offers support for industry-standard design tools, a notable area it lacked with its first Intel Custom Foundry foray in the past.

Indeed, the very first encounter with Apple disrupted TSMC's roadmap. TSMC planned to move from 28nm planar to 16nm FinFET, but Apple wanted a custom 20nm-class planar node instead. At the time, TSMC did not have enough R&D teams to develop two process technologies at once, so the company had to divert people working on CLN16FF to CLN20SOC to meet Apple's needs in 2014. 

Although Apple dual-sourced its A8 and A9 processors at 20nm and 16nm-class process technologies from Samsung and TSMC, Apple eventually committed to TSMC for all future processors. The Apple Silicon strategy cemented TSMC's position as the exclusive supplier, as the company's system-on-chips for different applications share quite a lot of IP.

The decision to meet Apple's demands was critical in TSMC surpassing Intel as the world's most advanced semiconductor manufacturer. Apple's business gave TSMC predictable high-volume orders, helping justify massive CapEx and R&D investments. As a result, TSMC has consistently outpaced Intel by introducing leading-edge nodes.

Hua Hong Semiconductor, China's second-largest chip foundry, has made strategic leadership changes to prioritize logic chip production and develop more advanced process technologies. The company hired Bai Peng, a veteran in logic chip technology, and appointed him president on January 1, 2024, reports Nikkei. 

Bai Peng, who spent over three decades at Intel and led logic chip development from research to mass production, is expected to steer Hua Hong's shift toward advanced semiconductor production technologies. Hua Hong are one of China's few foundries to offer 40nm fabrication process along with SMIC. While 40nm is a fairly sophisticated technology, it cannot enable modern processors for AI, HPC, and client computing applications. The task for Bai Peng will be to advance Hua Hong's manufacturing processes. The report says that Bai's expertise aligns with the company's focus to develop fabrication nodes essential for AI and other high-end applications. 

Hua Hong has historically focused on power semiconductors, analog chips, and embedded memory products, with most of its offerings at 100nm or larger. Hua Hong's financial performance has declined since its 2022 peak due to falling legacy chip prices, which are particularly vulnerable to market fluctuations. As a result, declining prices has pushed the company to diversify into logic chips, a market currently dominated by a few Chinese companies, including SMIC.

To expand its production capabilities, Hua Hong acquired a former GlobalFoundries facility in Chengdu, China, in 2023 and began operations in 2024. Additionally, a new plant in Wuxi is now producing chips of 40nm and above. These expansions aim to position Hua Hong as a key player in both legacy and advanced chip markets. 

Hua Hong held approximately 2% of the global foundry market during the third quarter of 2023, according to TrendForce. For now, the share is small, but the company certainly wants to change that. STMicroelectronics, a leading European chipmaker, announced plans to outsource some production to Hua Hong last year, which highlights the increasing recognition of Hua Hong's manufacturing capabilities. 

The parent company, Huahong Group, has also undergone leadership changes. Tang Junjun, previously president, was promoted to chairman. Tang brings extensive experience from his tenure at a joint venture between Huahong Group and NEC. Additionally, Qin Jian, who led Shanghai Alliance Investment — a significant Hua Hong shareholder — became the parent group’s chairman in December 2023. 

These appointments have fueled speculation about a potential collaboration between Hua Hong and SMIC, China's largest and most advanced foundry. Such a partnership could bolster China's efforts to build a self-reliant semiconductor ecosystem, reducing dependency on foreign supply chains.

One of the interesting things that Intel shared in its CES 2025 press release is the fact that the company is sending samples of its 'lead 18A product' — the codenamed Panther Lake processor for client computers — to its customers among PC makers. The company stressed that the CPUs will be mass-produced on the Intel 18A process technology in the second half of this year, which is good news for the company.

"Intel is only going to continue bolstering its AI PC product portfolio in 2025 and beyond as we sample our lead Intel 18A product to customers now ahead of volume production in the second half of 2025," a statement by Intel reads.

Intel's Panther Lake is an essential processor for Intel as it will be 70% manufactured in-house, which means significantly lower costs and substantially higher profit margins. Leaked specifications indicate that Panther Lake will feature between eight and 16 cores in various configurations, depending on positioning. The CPU is expected to be a notebook-first product to succeed both Arrow Lake and Lunar Lake laptop processors. Yet, what will succeed Arrow Lake-S CPUs for desktops remains to be seen.

One of the important aspects of Intel's Panther Lake is that it will be produced on the company's 18A process technology (1.8nm-class), a make-or-break production node. The 18A process is Intel's first (technically, second, but 20A has essentially been canceled) process technology, which uses RibbonFET gate-all-around transistors and has a backside power delivery option called PowerVia.

The backside power delivery network is particularly important for large and power-hungry data center-class processors, so whether it will be used for Panther Lake CPUs designed for client PCs with a processor base power (PBP) rating of 45W is unclear. Intel is also prepping its data center-oriented codenamed Clearwater Forest processor on 18A technology. This CPU will consume hundreds of watts of power and take advantage of PowerVia's backside power delivery network. Intel says that Clearwater Forest can already boot operating systems, though it is unclear when this CPU is set to enter volume production.

Another crucial factor is that Intel's 18A will be the company's first node used by external Intel Foundry customers. Therefore, Panther Lake's on-track production in the year's second half highlights the health of the fabrication technology.

The manufacturing process has garnered significant interest from IF customers (according to Intel) because it is considered more competitive than TSMC's 3nm and 2nm-class technologies slated for release between 2024 and 2025, at least in terms of some parameters. Intel anticipates that its first external customer will finalize the 18A design in the first half of 2025.

Assuming the design is free of bugs and defects, it will enter high-volume production in the first half of 2026. This timeline positions Intel's 18A slightly behind TSMC's N2 technology (a 2nm-class process) on the foundry market. TSMC's N2 is scheduled for high-volume manufacturing in the second half 2025. Still, since Intel will produce its Panther Lake on 18A in the second half of this year, this fabrication technology will technically hit the market ahead of TSMC's N2.

Intel's market capitalization dropped from around $198 billion in early 2024 to around $87 billion today, which makes the company an interesting acquisition target. Broadcom is certainly one of the companies that is known for making large acquisitions, and given its current focus on custom datacenter processors for AI, it could potentially be interested in taking over. However, its chief executive played down such a possibility citing a lack of Interest from Intel. 

"[Broadcom has] not been asked [to take over Intel]," said Hock Tan, chief executive of Broadcom, in an interview with the Financial Times. "I can only make a deal if it is actionable. Actionability means someone comes and asks me. Ever since Qualcomm, I learned one thing: no hostile offers." 

Back in 2018, Broadcom's $142 billion attempt to acquire rival chipmaker Qualcomm through a hostile takeover was stopped by then-President Donald Trump in a rare and extraordinary move. 

Earlier this year, we reported that Qualcomm was potentially interested in acquiring Intel, although it ultimately turned out that other reports said the company lost interest in buying Intel with all of its product divisions and manufacturing operations. 

Just like a merger with Qualcomm, an Intel merger with Broadcom could align with industry megatrends. Broadcom enjoys growing demand for AI processors it designs for clients like Google as well as connectivity solutions in data centers. By contrast, Intel's processors power the vast majority of servers as well as client PCs. Broadcom lacks presence in PCs and does not supply server CPUs. 

Intel's strength is, of course, its production scale and dominance in client computers. However, Intel is currently struggling to keep its process technologies competitive with TSMC and its processor products competitive with rival AMD. As a result, the appeal of the company is not particularly high at this point, especially because Broadcom has to integrate VMware, a company it acquired for $61 billion in 2022. 

Additionally, Broadcom is busy with its bespoke processor business for major high-tech companies, including ByteDance, Google, Meta, and reportedly Apple and OpenAI, which are seeking alternatives to Nvidia's processors. 

Tan described the ongoing investment frenzy in Silicon Valley, where tech giants are rapidly planning AI infrastructure projects for the next three to five years. These firms are constructing massive data centers, such as xAI's Memphis facility with 100,000 Nvidia GPUs and Colossus with up to one million Nvidia GPUs, to handle the computing needs of their ambitious AI programs. 

Tan has predicted that AI projects for Broadcom's clients could require clusters with up to one million processors as demand for computing power to train and run advanced AI systems continues to grow. He emphasized that the scaling principle—more data and processing yielding smarter AI—is driving these investments, despite uncertainty about when or if artificial general intelligence (AGI) will be achieved.

LR Trust, an Intel shareholder, has filed a lawsuit related to the performance of Intel Foundry and against former and current executives as well as directors of the company (as discovered by The Register). The lawsuit accuses Pat Gelsinger, the former chief executive of Intel, and David Zinsner, an interim co-CEO and CFO of Intel, of mismanagement, misleading disclosures, and demanding the return of their compensations and other gains to the company. Among the listed demands, the plaintiffs seek the entire sum of Gelsinger's $207 million salary earned during his tenure in 2021, 2022, and 2023, which would then be paid back to Intel.

The lawsuit claims that Pat Gelsinger and David Zinsner failed to communicate the poor performance of the Intel Foundry division, which had struggled to attract significant interest from major fabless designers while bleeding money. The lawsuit accuses Intel of failing to disclose critical risks in its 2024 Proxy Statement, a claim similar to one for which the company the company was sued for earlier this year. The lawsuit further claims that executives and board members allowed misleading statements about Intel Foundry Services' (IFS) growth potential, obscuring substantial operating losses and declining internal revenue. 

LR Trust asserts that Intel misrepresented the financial condition and performance of IFS and issued materially false and misleading public statements regarding cost savings, operational efficiencies, and IFS's profitability. Intel's production unit lost $7 billion in 2023 alone, and losses worsened in 2024 as the company increased spending on new fabs. 

The lawsuit seeks remedies for alleged harm to the company itself. If successful, the damages would be paid to Intel rather than LR Trust and individual shareholders, which could improve the company's financial health. If LR Trust wins the lawsuit, it benefits primarily through its indirect interest as a long-term shareholder of Intel. 

The lawsuit also claims that Pat Gelsinger and David Zinsner allegedly received substantial compensation, including salaries, stock awards, and bonuses, during a period of alleged mismanagement and financial misrepresentation. As a result, the plaintiffs seek restitution and punitive damages, along with court costs.  

Page 19, point 70 of the lawsuit states [PDF]

"As later admitted by Intel, and in breach of the individual defendants' fiduciary duties, the true status of Intel's affairs at the time were that: (1) IFS's growth was not indicative of revenue growth reportable under its segment; (2) IFS experienced substantial operating losses in 2023; (3) IFS experienced a decline in product profit driven by lower internal revenue; (4) due to the foregoing, IFS could not be a strong tailwind to Intel’s foundry strategy; and (5) the Company failed to maintain adequate internal controls," the lawsuit states. "As a result of the foregoing, the Company's public statements were materially false and misleading at all relevant times." 

Just a few months after Pat Gelsinger presented Panther Lake Engineering Samples live at the Lenovo Tech World event, Intel reports that Panther Lake has now achieved power-on status at eight customers. During the Barclays 22nd Annual Global Technology Conference, the two interim co-CEOs at Intel dispelled rumors regarding 18A and the scheduled Panther Lake for launch in 2025.

Panther Lake, dubbed Core Ultra 300, is expected to be the successor to Intel's Arrow Lake-U/H family of CPUs, the latter of which is rumored to launch next month. These CPUs will be the first to be built using Intel's flagship 18A process as Intel looks to break free from TSMC. Over 70% of Panther Lake will be manufactured in-house. From what we can gather, Panther Lake is a mobile-first product.

Michelle Johnston Holthaus and David Zinsner, co-CEOs at Intel, confirmed that Panther Lake is in the hands of eight customers who've successfully achieved power-on status with ES0 silicon - likely the first Engineering Samples. Intel's turnaround hinges on 18A - powering Clearwater Forest and Panther Lake - so much so that ex-CEO Pat Gelsinger had to step in at X to set the record straight. While Intel didn't explicitly mention yields or newer defect density measures, this is still a positive development, given the recent corporate fiasco and all the FUD surrounding the firm.

Panther Lake is rumored to reintegrate the memory controller back into the Compute Tile to ward off latency issues similar to Arrow Lake. The latency issue is actually due to several reasons but largely stems from an outdated SoC Tile and an off-die design.

With upwards of 16 cores, Panther Lake isn't a successor to Lunar Lake but rather Arrow Lake. Architecturally speaking, we expect Intel to use Cougar Cove P-cores and Skymont/Darkmont E-cores. With Lunar Lake already in the lead, Panther Lake might officially dethrone AMD in the graphics department - set to feature up to 12 Xe3 (Celestial) iGPU (Integrated GPU) cores.

2025 will be a make-it or break-it year for Intel, and ultimately, if the company wants to transition away from TSMC for leading-edge nodes, all of its offerings hinge on 18A's success. Like Lunar Lake, Intel might reveal Panther Lake at Computex next year, but a late 2025 launch is also on the cards.

While Michelle Johnston Holthaus, Intel's interim co-CEO, believes that spinning off the Intel Foundry division into a completely separate entity is not a wise idea, she notes that the fate of Intel manufacturing will be decided by 'someone,' likely either in reference to the Intel board or a future CEO. David Zinsner, the other interim co-CEO of Intel, believes that spinning off or retaining manufacturing operations as a separate entity is an open question. 

"We really do already run the businesses fairly independently," said Michelle Johnston Holthaus at the Barclays 22nd Annual Global Technology Conference. "Product co makes their decisions, foundry makes their decisions. […] Great products with a great process, technology that we have first access to, is a differentiator. So pragmatically, do I think it makes sense that they are completely separated and there is no tie? I do not think so. But, you know, someone will decide that."

After Pat Gelsinger was forced to retire earlier this month, David Zinsner said at a conference that the company's core revival strategy would remain intact. The company still wants to be a leading supplier of CPUs and a leading foundry, which pretty much excludes spinning off Intel Foundry into a separate entity.

However, at the Barclays Conference, he did not dismiss the idea of spinning off the manufacturing unit outright. He also said that eventually, Intel Foundry will become an Intel company (akin to what Mobileye and Altera are today) rather than a part of Intel, which means that the parent company wants to distance itself from Intel Foundry as much as possible. This involves creating a dedicated operational board for Intel Foundry, which is already being set up, and implementing a separate enterprise resource planning (ERP) system. These initiatives are in motion, and it is only a matter of time before Intel completes the necessary milestones. 

"We already run the businesses separately, but we are going down the path of creating a subsidiary for Intel Foundry as part of the overall Intel company," said Zinsner. "We are going to have a separate operational board for Intel Foundry, which is getting stood up today. It will have its own ERP system and so forth. So that's already in flight, and that is going to happen. […] Does it ever fully separate? I think, you know, that is an open question, you know, for another day."

Once Intel Foundry is a completely separate unit, Intel could IPO it while retaining full control. However, it is unclear what the point would be of spinning off a foundry that makes products that are not leading the market.

Currently, Intel is focused on making its 18A (1.8nm-class) process technology a success. The company is working to reduce 18A defect density, thus improving yields and decreasing performance variability. Intel has received 'a number of' requests for proposals (RFPs) from interested parties, though it is too early to say whether they will transform into actual orders. The company intends to share 18A progress at its earnings call in late January, which is when we will learn how the fabrication technology progresses.

"We have a couple of milestones that are coming up here in the not too distant future that we are likely to update investors on at the end of January," said Zinsner. "[…] We have received a number of RFPs that we are working through over the course of the next few months. And my sense is we will probably provide some update [in] January."

It's still arguably too early to confidently state how successful Intel's 18A process technology (1.8nm-class) will be. But in about a year, we should know if Pat Gelsinger's five nodes in four years plan was a success. That said, Intel's failure to offer a competitive AI processor is evident even today, which gives Morris Chang, the founder of TSMC, reason to claim that Intel should have focused on the development of AI processors rather than on making chips using leading-edge nodes. The TSMC icon also said that Intel had neither a strategy nor a new CEO, and that finding both will be difficult.

"I do not know why Pat resigned," said Chang at a press conference dedicated to the publication of his biography, Reuters reports. "I do not know if his strategy was bad or if he did not execute it well." [...] "Compared with AI, he seemed to focus more on becoming a foundry. Of course, now it seems that (Gelsinger) should have focused on AI."

Chang's criticism is understandable. Nvidia earns tens of billions of dollars per year selling AI processors, considerably more than TSMC earns on fabbing those chips. If Intel had competitive AI processors, it could make more money than it would on making chips for others, so it's easy to argue that an AI strategy should have been prioritized years ago.

When Gelsinger took the reigns in 2021, his main strategy was focused on IDM 2.0, which involved developing five leading-edge process technologies in four years and becoming the world's second-largest contract maker of chips by 2030. While Intel clearly had a product strategy as well, the world has yet to see major products developed under Pat Gelsinger as the CEO.

Last month, Intel announced it would miss its $500 million sales target for the Gaudi 3 AI accelerators this year due to software issues. It usually takes over three years to develop, implement, and mass-produce a chip. Gaudi 3 was at least partially defined before Gelsinger became the CEO of Intel, so it is impossible to say that he is responsible for this product's hardware. Nonetheless, insufficient focus on AI software seems evident.

Chang's biography, released recently, provides a deeper context to his remarks. The memoir chronicles his life from 1964 to 2018 and sheds light on TSMC's key partnerships with companies like Apple and Qualcomm. It also recalls Intel's decision in the 1980s to decline an invitation to invest in TSMC, another move that, at this point, is easy to see in hindsight as a missed opportunity.

Intel's current situation is marked by uncertainty. With no immediate successor for Gelsinger, its strategic direction seems the same for now — develop competitive products and retain manufacturing operations — and that means facing the same challenges. And although Gelsinger is out, the Board of Directors has yet to say whether the company has defined its revamped strategy for AI.

"They currently have neither a new strategy nor a new CEO," Chang added. "Finding both is very difficult."

Today, the Intel Foundry Technology Research team announced technology breakthroughs in 2D transistor technology using beyond-silicon materials, chip interconnects, and packaging technology, among others. The company will unveil its research in seven of its own papers, along with two more papers in collaboration with industry partners like imec, at the IEEE International Electron Devices Meeting (IEDM) 2024 conference.

Intel’s disclosures include new research that enhances gate-all-around (GAA) transistor scaling and performance both with silicon and with atomically-thin 2D transistors that use beyond-silicon materials. Intel also outlined its subtractive Ruthenium technology that improves interconnect performance and scalability, ultimately enabling smaller wires between transistors, and a chip packaging breakthrough that improves chip-to-chip assembly throughput by 100x.

Intel’s Technology Research team, formerly known as the Components Research team for the last 50 years, is part of Intel Foundry. This team works on developing products intended for commercialization in the nearer term than the more far-looking initiatives at Intel Labs. The Technology Research team is known for paving the way for many of Intel’s fundamental technologies, with the latest innovations like the PowerVia backside power delivery and RibbonFET gate-all-around architecture originating in this group.

Intel hasn’t presented the papers at IEDM yet, and our one-on-one discussion with the General Manager of the Research Team isn’t until tomorrow. We’ll provide the descriptions of the breakthroughs below, but we’ll circle back with an update to fill in more details.

Interconnect scaling breakthough

As transistors get smaller, so too must the wires (interconnects) that connect them. Copper is the material of choice for the billions of nanometer-scale wires that move power and data around inside the chip in a complex 3D grid (you can see what this looks like in this video). In fact, up to 50 miles of interconnect wiring are inside modern chips. However, the ability to shrink these microscopic wires is running out of steam, and most alternatives aren’t suitable for high-volume manufacturing. This is a critical roadblock to moving forward to smaller process nodes.

Much like a standard copper wire you use in your home for electrical devices, the wires that carry electrons between transistors need an insulator, in this case, a dielectric coating, to prevent the electrons from going places they shouldn’t. However, the wires also require a barrier to prevent copper diffusion that could contaminate the dielectric. This barrier creates issues with shrinking the wires. 

Shrinking the interconnect wires in a processor is exceedingly difficult because of the requirements of copper damascene, an additive process used to create the wires. First, a trench is created, then a barrier is deposited in the trench on top of a dielectric. A seed layer is then placed on top of the barrier to enable copper electroplating; then, copper is deposited on top. Any excess material at the top is then polished away.

As shown in the image above, decreasing the amount of copper helps to thin the wire, but it also decreases the ratio of the copper (bulk) to the barrier and seed layer, and resistivity increases exponentially as the wires are shrunk. This means the wires carry less current, slowing the device speed (among other effects) and impacting capacitance.

Intel’s Technology Research team has developed a process suitable for high-volume manufacturing that uses Ruthenium instead of copper. It also features air gaps. 

Air gaps are a technology that Intel introduced back in the 14nm process node. This technique removes sections of the insulative dielectric, leaving air instead (air has a dielectric constant of around 1.0) to reduce capacitance (Intel claimed a 17% improvement in capacitance with 14nm).

Intel hasn’t shared the deep dive details of its Subtractive Ruthenium process, but we’re sure to learn more details during the presentation. Intel says its Subtractive Ruthenium process with airgaps provides up to 25% capacitance at matched resistance at sub-25nm pitches (the center-to-center distance between interconnect lines). Intel says its research team “was first to demonstrate, in R&D test vehicles, a practical, cost-efficient and high-volume manufacturing compatible subtractive Ru integrated process with airgaps that does not require expensive lithographic airgap exclusion zones around vias, or self-aligned via flows that require selective etches.”

Intel envisions using this technique for the most critical layers with the smallest pitches at first, while standard copper damascene will be used for the larger upper layers. Naturally, Rutheniuem will also be beneficial for its PowerVia backside power delivery. In the end, these smaller wires will enable connecting to smaller transistors, and Intel says this tech will likely be used in future Intel Foundry nodes. 

Gate-All-Around (GAA) transistor breakthroughs

Intel’s RibbonFET is its first new transistor design since FinFET arrived more than 13 years ago. It is Intel’s first gate-all-around (GAA) transistor, debuting with the 20A and 18A nodes. It features stacked nanosheets surrounded entirely by a gate, as opposed to the fins surrounded on three sides used for FinFET.

Now, the challenge is to shrink the GAA designs further, and Intel is tackling that in both standard silicon designs and using new 2D materials. With standard silicon, Intel’s transistor disclosures show enhanced gate-all-around RibbonFET CMOS scaling, resulting in a gate length of 6nm and a nanoribbon/nanosheet thickness of 1.7nm while delivering improved short channel effects and higher performance. 

On the first side, the gate length vs electron velocity graph on the right shows an impressive profile. The table in the center of the slide shows comparisons to existing transistor technologies, with the Tfin/Tsi (fin thickness/nanoribbon thickness) for the nanoribbon being nearly twice as thin as the fin used in FinFET. 

The biggest question is, what’s next after silicon? After CFET transistors arrive, the next step of GAA is to change the materials used in NMOS and PMOS transistors to 2D materials (only a few atoms thick). The second slide outlines Intel's advances using atomically thin transition-metal dichalcogenide (TMD) materials, widely thought to be the materials used after silicon. 

Intel fabricated 2D gate-all-around NMOS and PMOS transistors with a gate length of 30nm using moly-based material. Intel claims this effort delivered ‘best in class NMOS drive currents,’ a 2X improvement over the next-best published result. The chart on the right shows the research vehicle outperforming other such exploratory efforts into TMDs.  

Intel’s transistor track also includes a view back at the last 60 years of transistor tech and a call to action for the industry to develop transistors that operate at ultra-low Vdd (supply voltages) of sub-300mV, a substantial decrease from today’s 1V range. This is a stretch goal for the 2030s and 2040s.

Packaging breakthroughs

Intel's new Selective Layer Transfer (SLT) tech enables attaching an entire wafer of chip dies to another wafer at extremely high speeds —Intel says SLT enables a 100X increase in throughput for the chip-to-chip assembly process. With SLT, the entire wafer full of dies can be connected to the underlying wafer at once, and individual dies can be selected for bonding while others can be excluded. This tech uses inorganic infrared laser debonding.

Intel also cites that SLT "enables ultra-thin chiplets with much better flexibility to enable smaller die sizes and higher aspect ratios versus traditional chip-to-wafer bonding." Intel's descriptions of this new tech aren't entirely clear, so we hope to learn more from the presentation. It appears this would be a great alternative to approaches that use reconstituted wafers. We'll add more detail here once we learn more. 

Intel will also have an IEDM-invited talk about tomorrow's packaging solutions. This slide above revealed EMIB-T, which hasn't been disclosed previously. As a reminder, EMIB is Intel's Embedded Multi-Die Interconnect Bridge, a low-latency, low-power, and high-bandwidth interconnect that connects die together. 

Intel disclosed that EMIB-T stands for EMIB-TSV. This variant marks the first EMIB implementation that uses TSVs to send the signal through the bridge with TSVs instead of wrapping the signal around the bridge.

At IEDM, Intel will submit seven papers along with two other papers with partners such as imec, Aixtron, and the Tor Vergata University of Rome. 

We have time carved out with Intel for follow-up questions, and we'll update this piece with more details soon. 

While it is widely believed that Intel's board of directors ousted chief executive Pat Gelsinger earlier this week as they did not agree with his strategy and tactics, interim co-CEO David Zinsner said at a conference that the company's core revival strategy would remain intact. The BoD still believes that Intel should continue developing its products and maintain its manufacturing capacity to produce its own products as well as make chips for others.

"I mean, the Board was pretty clear that the core strategy remains intact," Zinsner said at the UBS Global Technology Conference this week. "We still want to be a world-class foundry, and we want to be the Western provider of leading-edge silicon to customers. That remains our goal."

One of the objections that the Board had against Pat Gelsinger was his execution on the product side of the business, as Intel Foundry can only be successful if Intel's products are successful and the chip designer can guarantee a high utilization rate for the manufacturing unit. Apparently, the BoD was not particularly happy with product delays in general and the failure to get into the AI game in particular.

Given that by now the board of directors has outlined that it needs a chief executive who can successfully execute on the product side of the business while also continuing to develop the foundry business, it is at least more or less clear what kind of person the BoD is looking for. In fact, there are very few people in the industry who have the right experience to run Intel at this point, which makes letting Pat Gelsinger go seem even more shocking. But apparently, the board somehow lost hope in Gelsinger.

"I would not read into the fact that the Board wants to focus on making sure we build out the products business and continue to execute there while standing up a foundry business as something related to Pat and the Board deciding that now is the right time," said Zinsner. "That was for personal reasons specific to Pat and the Board."

The good news is that Intel's board of directors does not seem to have immediate plans to spin off manufacturing. However, with Gelsinger out, it will be hard to find someone who has experience with executing product development and developing the foundry business.

Two days ago, the industry was taken aback by Pat Gelsinger's surprise resignation - suddenly deciding to step down as the CEO of Intel and likewise exiting the board of directors. With two co-CEOs working as ad-hoc replacements, Team Blue's executive structure is in dire straits as it looks for a suitable successor to Gelsinger. Through publicly available 8-K Forms and a guesstimate from Reuters, Patrick Gelsinger has reportedly left Intel with a severance package worth $12 million - further exacerbated by his large stake in Intel.

Traditionally, CEOs announce their resignations months before the fact and nominate a suitable successor. In light of rumors - so much so that you can practically smell them in the air - there is speculation that Pat was likely shown the door at a request by displeased board members. Gelsinger spearheaded a struggling Intel under his IBM 2.0 strategy as Chipzilla is now nearing its 5N4Y (five nodes in four years) promise with 18A around the corner. Intel refused to provide further clarification, but this corporate debacle casts doubt over its great ambitions in Intel Foundry, DCAI (Data Center and Artificial Intelligence), and AXG (Accelerated Computing Systems and Graphics) segments - to name a few.

Per the filing, payday is knocking on the door early for Gelsinger as he is set to enjoy a lavish golden handshake. The package includes a severance pay equal to 18 months of service as CEO totaling $1.875 million ($1.25 million for 12 months) backed by 1.5x of Gelsinger's current target bonus - which itself is 275% of his base salary - netting us $5.15 million - payable throughout 18-months. Lastly, pro-rata payments equivalent to 11 months (out of 12) of the annual bonus should total almost $12 million per Reuters.

The industry is naming Lip-Bu Tan as a suitable successor, though it could take a while before candidates are shortlisted and selected for onboarding. Intel's repeated financial failures might have potentially created a rift between Gelsinger and shareholders. Earnings have been poor because bleeding-edge foundries aren't cheap to run and finance—especially when external consumer demand is almost non-existent to compensate for these high costs.

Still, the aftermath of this decision will materialize in the coming weeks or months. The CHIPS Act, in a way, restricts Intel from spinning off its foundry division since it must own at least 50.1% of Intel Foundry. Hence, it remains to be seen which division will be the first on the chopping block—or maybe none at all—who knows?

Now that Intel has signed a contract to get $7.865 billion in grants under the CHIPS and Science Act from the U.S. government, it cannot sell its Intel Foundry manufacturing unit and must maintain a controlling stake even in case it spins it off and makes it a public company under the terms of the agreement. Also, the contract restricts any third party from acquiring a substantial stake in Intel, Reuters noted.

Intel must keep at least 50.1% ownership of Intel Foundry if it decides to spin it off into a private company. If Intel Foundry goes public, no third party can own 35% or more unless Intel stays the largest shareholder. Additionally, Intel must retain control of Intel Foundry and all the other entities that receive funding under the agreement. Finally, under the terms of the deal, the agreement limits third parties from acquiring 35% or more of Intel's ownership or voting rights.  

While the terms of the agreement between Intel and the U.S. government allow Intel to spin off Intel Foundry into a private company (say, a joint venture with an investor or a group of investors) or a public company, Intel's wafer purchasing agreements with Intel Foundry must remain intact. This condition will ensure that Intel's products will be built by Intel Foundry, which will ensure the financial stability of the chipmaker. Also, all significant changes in Intel Foundry ownership or control must be aligned with the U.S. national objectives, which is not special as all significant transactions between big American companies and foreign investors require approval from the Committee on Foreign Investment in the United States (CFIUS) anyway. 

Furthermore, Intel must continue investing in advanced chip manufacturing and semiconductor research within the United States. In particular, the company must spend at least $35 billion on R&D in the U.S. from 2024 through 2028, as well as build, equip, and operate 12 fabs and advanced packaging facilities located in Arizona, New Mexico, Ohio, and Oregon. 

Intel provided no public comments on its Securities and Exchange Commission filing. Meanwhile, a representative from the Commerce Department stated that the government is working on control-related conditions with all recipients of direct grants, and the terms were not exclusive to Intel.

According to Bloomberg, Qualcomm has reportedly stepped back from its interest in acquiring Intel, citing the deal's complexity and challenges. While the acquisition would have been historic in its significance and scale, Qualcomm is now exploring other ways to expand, potentially targeting parts of Intel, as reported before.

Intel's market capitalization — currently at $102.38 billion — highlights the magnitude of the deal Qualcomm had considered. Adding a 20% premium would have made this takeover one of the biggest acquisition deals ever. If completed, it would have become the largest technology company acquisition, surpassing Broadcom's 2023 purchase of VMware. The deal would have created one of the world's largest high-tech companies with vast capabilities across various markets.

From the standpoint of industry megatrends, a match between Intel and Qualcomm would have made a lot of sense. Qualcomm has 5G application processors for smartphones and processors for PCs, yet for now, Qualcomm is not a big player on the PC front. By contrast, Intel is the largest supplier of CPUs for PCs. At the same time, Intel is absent from consumer 5G devices (something it sold to Apple years ago, and that division has to develop a competitive modem, which, given the complexities of 5G modems, is hard). Yet, Intel's processors are used in 5G base stations and data centers.

Intel has its AI and HPC strategy, but it has yet to prove that it works. By contrast, Qualcomm has nothing to offer when it comes to high-performance AI and HPC for data centers.

While Intel is losing market share to AMD in the data center space, with its world-class brand and vast production capacity, it outpaces AMD in the client PC space and still produces the majority of data center CPUs. This advantage will remain for as long as Intel has its manufacturing capacities.

However, the proposed acquisition faced significant obstacles, including Intel's $50 billion debt, dropping CPU market share, and its struggling semiconductor manufacturing unit, an area where Qualcomm lacks expertise. A deal of this magnitude would also likely trigger extensive regulatory scrutiny, particularly in China, a key market for both companies.

Intel is undergoing significant restructuring under CEO Pat Gelsinger to reclaim its competitiveness in the semiconductor market in terms of products and process technologies. Still, for now, both Intel and Qualcomm are quite successful standalone companies. While the combination would make a formidable firm (probably facing unprecedented antitrust scrutiny), it does not make much sense for Qualcomm to make such a massive takeover. These factors have collectively made a complete takeover less appealing to Qualcomm. Meanwhile, selling off a part of the company to Qualcomm may not make sense for Intel.

Qualcomm aims to generate $22 billion in annual revenue by 2029 by expanding into markets like personal computers, networking, and automotive chips. Although Cristiano Amon, Qualcomm's chief executive, has stated that his company did not need a major takeover to achieve this goal, the company initiated preliminary discussions with Intel regarding a potential acquisition in September. Yet, it does not look like the deal is going to happen.