Intel and TSMC reach preliminary agreement on US chip manufacturing joint venture

TSMC will take a 20% stake in the new company

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In brief: It appears the previous reports that TSMC and Intel are set to form a joint venture to operate Team Blue's US fabs were accurate. The tech giants are said to have reached a preliminary agreement on the plan, which has been pushed by the White House and Department of Commerce in the hope of helping Intel address its current manufacturing crisis.

The deal will see TSMC, the world's largest contract chipmaker, take a 20% stake in the new company. The report comes from The Information, citing two people familiar with the matter.

It was reported in March that TSMC had proposed a joint venture that would see it take a stake in Intel's foundry business alongside Nvidia, AMD, Broadcom, and Qualcomm. It's possible that one or more of those companies could own some of the remaining 80% of the venture.

Nvidia CEO Jensen Huang said two weeks ago that he was never approached by a consortium about investing in the joint venture. "Nobody invited me. Maybe other people are involved, but I don't know. There might be a party. I wasn't invited," he said. A TSMC board member also denied there had been any discussions.

It was reported late last year that Qualcomm had approached Intel with an acquisition offer. It backed off from a full acquisition in November, though buying select divisions remains a prospect.

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The Trump administration does not want either Intel or its foundry business to be entirely foreign-owned, but the government is aware of the urgency in turning around Intel's fortunes.

Government officials met with TSMC executives last month to raise the idea of a deal between the company and Intel. TSMC was said to be receptive, which likely came as a relief to the administration as it looks at contingency plans in the event of Intel crashing even further.

Intel's foundry division reported a loss of over $13 billion on $17.5 billion in revenue in 2024. Overall net loss for the year stood at $18.8 billion, the company's first annual loss since 1986.

TSMC has announced that it would be investing an extra $100 billion in the United States' chip manufacturing industry, adding to a previous $65 billion commitment. The money will be used to build five new chip facilities, among other projects. It's unclear how the joint venture with Intel will fit into these plans.