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April 4 - Intel (NASDAQ:INTC) and TSMC (NYSE:TSM) are moving closer to a partnership that could reshape US chip manufacturing. The two companies have reached a preliminary agreement to form a joint venture, with TSMC taking a 20% stake.
This move comes after months of pressure from the White House and Commerce officials, who want to strengthen domestic chip production. Intel has struggled to keep up with rivals, and this collaboration could be a turning point.
Earlier reports suggested TSMC had also pitched the idea to Nvidia (NASDAQ:NVDA), AMD (NASDAQ:AMD), and Broadcom (NASDAQ:AVGO), but those discussions didn't gain traction.
Intel has stumbled in its efforts to build chips for external customers based on reliability and technical support. TSMC, meanwhile, is the world's top contract chipmaker, and thus, the foundation for the venture is looking strong.
With Intel's leadership shake-up and a renewed push for US-based chipmaking, investors are watching closely. If this deal moves forward, it could mark a major shift in the semiconductor industry.
This article first appeared on GuruFocus.