Intel Corporation (INTC) saw its stock rise over 5% in Tuesday’s pre-market trading following reports that Broadcom (AVGO) and Taiwan Semiconductor Manufacturing Co. (TSMC) are considering potential deals involving portions of the chipmaker.
According to a Wall Street Journal report, Broadcom has been evaluating Intel’s chip design and marketing business, while TSMC is exploring a possible acquisition of some or all of Intel’s manufacturing facilities. The discussions remain preliminary, and no formal bids have been made.
These developments come amid speculation that the Trump administration is encouraging TSMC to invest in Intel’s foundry services business as part of its efforts to strengthen US semiconductor production. Reports suggest that TSMC could take up to a 20% stake, either through direct investment or technology collaboration.
Intel has faced significant financial struggles, including large-scale layoffs and dividend cuts. Despite a 16.7% year-to-date stock increase, its shares have declined nearly 47% over the past year, driven by concerns over its turnaround strategy and competitive challenges in the AI chip market.
The potential deals highlight a major shift in Intel’s trajectory. Historically, Intel dominated chip design and manufacturing but has struggled to keep pace with industry leaders like TSMC and Samsung. The possibility of a split between its design and manufacturing divisions aligns with broader industry trends, where companies often specialize in one aspect of semiconductor production.
Any deal involving Intel’s factories would likely require approval from the US government, given Intel’s role in national security and its receipt of substantial funding under the CHIPS Act. Additionally, concerns about operational adjustments—such as adapting Intel’s foundries to TSMC’s manufacturing processes—could complicate negotiations.
Intel is also in the midst of a leadership transition, searching for a new CEO after Pat Gelsinger’s departure in December. The outcome of these discussions may significantly influence the direction of the company under new leadership.
The Wall Street Journal and Benzinga contributed to this report.
