TSMC and Broadcom Consider Bids to Split Intel in Half

Chip giants TSMC (NYSE:TSM) and Broadcom (NASDAQ:AVGO) are exploring potential bids for Intel (NASDAQ:INTC), possibly splitting the semiconductor leader, according to the Wall Street Journal. TSMC is evaluating acquiring Intel's chip manufacturing plants, either independently or with a consortium. Broadcom is interested in Intel’s chip design and marketing units but would pursue a bid only if a partner for Intel’s foundry business is secured.

The discussions are in early stages, and Intel has not been approached. Both firms are acting independently. This speculation comes as Intel struggles to keep pace with rivals like AMD (NASDAQ:AMD), Nvidia (NASDAQ:NVDA), Qualcomm (NASDAQ:QCOM), and Broadcom in the AI-driven chip market. Intel's foundry business has consistently posted losses amid fierce competition from TSMC.

Intel recently started separating its foundry division, a move that could facilitate a split. The company remains the largest beneficiary of the U.S. CHIPS Act, receiving substantial federal funding. However, the involvement of the U.S. government, particularly the Trump administration, adds complexity, as foreign control over domestic chip facilities is unlikely to receive presidential approval.

The potential acquisition discussions follow Intel’s leadership turmoil, with CEO Pat Gelsinger ousted in December after failing to implement a successful turnaround. The company is currently seeking new leadership. This development underscores the increasing pressure on Intel as it navigates financial losses, leadership changes, and intensified competition in the semiconductor industry.