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Intel (NASDAQ:INTC) is getting a lifelineand it's coming from an unlikely partner. Taiwan Semiconductor Manufacturing Company (NYSE:TSM) is stepping in to co-run Intel's chip factories through a new joint venture, with TSMC taking a 20% stake, according to insiders cited by The Information. The deal, still in its early stages, follows months of pressure from the White House to get the two rivals on the same page. If it moves forward, this could mark a major turning point not just for Intel, but for the U.S. semiconductor industry's push to regain relevance in the global chip race.
Intel has been in deep trouble. It lost $18.8 billion in 2024its first annual loss since 1986and fell woefully behind in the AI chip boom. While competitors sprinted ahead, Intel kept sinking billions into its foundry business, but couldn't match the speed or service levels of TSMC. Former execs pointed to failed tests, missed deadlines, and unhappy customers. The company's new CEO, Lip-Bu Tan, a seasoned semiconductor veteran, now has the near-impossible task of engineering a comebackand this deal with TSMC might be his boldest move yet.
TSMC isn't just doing Intel a favorit's doubling down on its U.S. expansion. The Taiwanese giant recently unveiled a $100 billion plan to build five new fabs in the U.S., and this Intel JV would give it even deeper roots. For investors, this partnership could rewrite the narrative. After losing 60% of its value last year, Intel shares are up only 3% in 2025. If this deal locks in, and if Intel can finally start shipping on time with TSMC at the helm, we may be looking at the start of one of the more surprising tech turnarounds of the decade.
This article first appeared on GuruFocus.