Intel's $18.8B Meltdown:Can a TSMC Rescue Deal Save the Chip Giant?

Intel ( NASDAQ:INTC ) is weighing a major shake-up as it explores handing off its struggling foundry division to a joint venture led by Taiwan Semiconductor Manufacturing Company ( NYSE:TSM ). TSMC reportedly pitched Nvidia ( NASDAQ:NVDA ), AMD ( NASDAQ:AMD ), Broadcom ( NASDAQ:AVGO ), and Qualcomm ( NASDAQ:QCOM ) on taking stakes in the business, with TSMC keeping its ownership below 50 percent. The move, reportedly encouraged by the Trump administration, comes as Intel tries to recover from a brutal $18.8 billion net loss in 2024its first since 1986. While Intel's board supports the talks, internal pushback and operational hurdles could complicate the deal, with U.S. regulators likely playing a decisive role in the outcome.

TSMC isn't just making a play for Intel's foundryit's doubling down on its U.S. presence, rolling out a fresh $100 billion investment in domestic chip production. Meanwhile, Nvidia and Broadcom are already testing Intel's cutting-edge 18A process, with AMD still on the fence. But tensions are brewing, with Intel claiming its 18A tech beats TSMC's 2-nanometer process. Beyond that, the companies use vastly different manufacturing setups, making any integration a costly, technically complex challenge. Some Intel execs are wary of the deal, and sources say Qualcomm, once a potential buyer, has already walked away from talks.

With Intel's stock under pressure and the company rejecting piecemeal sales of its design unit, all eyes are on whether this deal will stick. Trump is pushing for stronger domestic chipmaking, and any agreement will need Washington's blessing. If this joint venture materializes, it could mark a turning point for Intel, reshaping the U.S. semiconductor landscape in the process.

This article first appeared on GuruFocus .