Intel Faces Potential Breakup as Broadcom and TSMC Eye Key Units

Intel (NASDAQ:INTC) is at the center of potential acquisition talks, with Broadcom (NASDAQ:AVGO) and Taiwan Semiconductor Manufacturing Co (TSMC) exploring deals that could split the U.S. chip giant, according to the Wall Street Journal. Broadcom is reportedly interested in Intel’s chip design and marketing division, contingent on finding a partner for Intel’s manufacturing operations. TSMC, the world’s largest contract chipmaker, is evaluating control over Intel’s chip plants, possibly through an investor consortium.

Discussions remain preliminary and informal, with no collaboration between Broadcom and TSMC. Intel’s interim executive chairman, Frank Yeary, is leading these talks, aiming to maximize shareholder value while addressing U.S. national security concerns.

The White House, under President Donald Trump, is wary of foreign control over Intel’s U.S. factories, despite supporting foreign investments in domestic operations. Bloomberg reported that Trump officials suggested a deal with TSMC, which expressed openness. Intel, Broadcom, TSMC, and the White House have yet to comment.

Intel has benefited from U.S. efforts to onshore semiconductor production, including a $7.86 billion subsidy from the Commerce Department. Despite TSMC's market valuation being about eight times higher than Intel's, Intel remains one of the few companies designing and manufacturing chips. TSMC serves top clients like Nvidia (NASDAQ:NVDA) and AMD (NASDAQ:AMD).

Former Intel CEO Pat Gelsinger’s ambitious manufacturing and AI plans fell short, leading to contract losses and a 60% drop in Intel’s stock value last year. Intel’s capital-heavy manufacturing strategy strained finances, resulting in a 15% workforce reduction. The potential deals mark a pivotal moment for Intel and the semiconductor industry.