The US government is encouraging major chip designers like Nvidia and Apple to use Intel’s foundry services for their artificial intelligence (AI) chip needs. This move aims to establish domestic foundry capabilities and reduce reliance on Taiwan-based Taiwan Semiconductor Manufacturing Company (TSMC).
Intel CEO Pat Gelsinger has been seeking help from US Commerce Department Secretary Gina Raimondo, who is trying to persuade companies like Nvidia and Apple to support chip manufacturing in the US. Raimondo has emphasized the economic benefits of having a domestic foundry capable of producing AI chips, as well as the increasing geopolitical risks around Taiwan.
Convincing these companies to switch contract manufacturers will be a significant challenge. However, Intel is building new plants in four US states and is expected to receive up to $8.5 billion in direct funding through the CHIPS and Science Act. Additionally, Intel may be eligible for up to $11 billion in federal loans under the same legislation.
Despite setbacks and delays, Intel’s foundry initiative has secured a notable win with Microsoft planning to use Intel’s foundry operations to manufacture a custom computing chip. Intel expects to surpass TSMC in advanced chip production before its original 2025 target and plans to extend this lead in 2026 with the introduction of its Intel 14A process.
Intel’s foundry business has faced significant losses, but the company is expected to break even on operating margins around 2027. With these developments, Intel is poised to play a crucial role in the US’ efforts to establish domestic foundry capabilities and reduce reliance on TSMC.
Source: https://www.techspot.com/news/104721-us-government-encouraging-likes-nvidia-apple-tap-intel.html