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Key Takeaways
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Intel shares jumped Thursday, extending their recent rally on speculation of a deal with TSMC.
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Intel could collaborate with TSMC to potentially spin off its foundry business into a new U.S.-based chipmaking entity, Baird analysts said.
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On Tuesday, Vice President JD Vance said the Trump administration wants artificial intelligence chips to be designed and manufactured domestically.
Intel (INTC) shares jumped Thursday, extending their recent rally on speculation of a deal with Taiwan Semiconductor Manufacturing Company (TSM).
The storied chipmaker has been the subject of discussions involving a potential U.S. chipmaking partnership with TSMC, Baird analysts said Wednesday.
TSMC could send engineers to Intel’s foundry business as part of such a venture, and potentially launch a new entity jointly owned by TSMC and Intel that could benefit from U.S. government funding under the Chips Act, the analysts said. Intel’s foundry business has struggled to keep up with TSMC, losing $13.4 billion in 2024.
A TSMC spokesperson declined to remark on such a deal, while Intel did not immediately respond to a request for comment.
The discussions come as Vice President JD Vance said Tuesday the Trump administration wants artificial intelligence chips to be designed and manufactured domestically. Policies favoring U.S. chip manufacturers could benefit Intel’s foundry, which makes chips in the U.S. for third parties.
Shares of Intel popped over 9% to $24.52 in Thursday afternoon trading and have gained nearly 30% so far this week. However, even with recent gains, the stock is down more than 40% over the past 12 months.
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