Core Viewpoint - Intel's new CEO, Pat Gelsinger, is pushing for a fundamental strategic shift in the company's chip foundry business, planning to stop promoting the long-invested 18A (1.8nm) process technology to external customers and instead focus resources on the next-generation 14A (1.4nm) technology [1][4]. Group 1: Strategic Shift - The decision to halt external sales of the 18A process marks a complete departure from the foundry expansion strategy set by former CEO, Bob Swan, and could lead to billions of dollars in asset write-downs [1][4]. - Intel's foundry business has been centered around "technology openness" since the introduction of the IDM 2.0 strategy in 2021, but customer penetration for the 18A process has been significantly lower than expected [4]. Group 2: Financial Implications - Analysts estimate that the R&D investment in the 18A and related technologies has already cost Intel billions, and without foundry orders to recover these costs, the company may face asset write-downs potentially amounting to "hundreds of millions to billions of dollars" [5]. - Intel will need to renegotiate contracts with existing foundry customers like Microsoft and Cisco, who had previously signed long-term agreements based on the 18A technology [5]. Group 3: Organizational Changes - Since June, Intel has been laying off employees in its automotive chip division and core chip design roles, affecting over 20% of staff [5]. - A new round of layoffs is set to begin on July 15, primarily targeting non-core teams in physical design and logic development, as the company shifts its culture towards "efficiency first" [5].

Core Viewpoint - TSMC is considering acquiring a stake in a joint venture that would operate Intel's foundry business, with the aim of reviving Intel's struggling operations and supporting U.S. advanced manufacturing efforts [1][5][6] Group 1: TSMC's Proposal and Negotiations - TSMC has approached companies like Nvidia, AMD, and Broadcom regarding a potential investment in a joint venture for Intel's foundry operations, with TSMC not holding more than 50% of the stake [1][2] - The negotiations are in early stages and require approval from the Trump administration, which is concerned about foreign control over Intel [2][5] - TSMC's proposal is part of a broader strategy to enhance its presence in the U.S. semiconductor market, following a commitment to invest $100 billion in new chip factories [5] Group 2: Intel's Current Situation - Intel's stock has dropped over 50% in the past year, and the company reported a net loss of $18.8 billion in 2024, marking its first loss since 1986, primarily due to significant asset impairments [4] - The company’s foundry division has a book value of $108 billion as of December 31 [4] - Intel's board supports negotiations with TSMC, although there is internal opposition from some executives [6] Group 3: Technical and Operational Challenges - Any collaboration between TSMC and Intel will face significant challenges due to differences in manufacturing processes, chemicals, and equipment used by both companies [6][7] - TSMC aims for potential investors to not only be shareholders in the joint venture but also customers of Intel's advanced manufacturing business [7] - The 18A process technology has become a contentious point in negotiations, with Intel claiming it is more advanced than TSMC's 2nm process [7]

Core Viewpoint - Intel's 18A process technology is being tested by NVIDIA and Broadcom, which could lead to significant manufacturing contracts for Intel's foundry services if successful [2] Group 1: Intel's 18A Process Technology - NVIDIA and Broadcom are testing Intel's 18A process technology, which utilizes RibbonFET transistors and PowerVia backside power delivery [2] - The performance of Intel's 18A process is considered to be between TSMC's current and next-generation nodes, providing Intel a competitive opportunity in the foundry market [2] - Successful testing by NVIDIA and Broadcom is crucial for Intel to enter the foundry market, currently dominated by TSMC [2] Group 2: Impact of IP Module Certification - The certification of third-party IP modules for Intel's 18A process has been delayed by six months, potentially affecting service capabilities for small and medium chip design companies [2] - Once certified, these IP modules (such as PHY, controllers, PCIe interfaces) are expected to be widely used in millions of chips [2] Group 3: Strategic Importance of Intel - The U.S. government is focused on revitalizing the domestic semiconductor industry, with Intel being a key player as the largest chip manufacturer in the U.S. [2] - If all goes well, Intel is expected to start offering 18A foundry services to third-party customers by mid-2026 [2]