Intel Corp CEO Pat Gelsinger is to visit Taiwan and Malaysia next week for talks that show how manufacturing in Asia is crucial to his efforts to turn around the fortunes of the world’s largest chipmaker by revenue.
Gelsinger’s trip is to include a meeting with leaders of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), people familiar with his plans said.
Intel needs TSMC’s advanced manufacturing services and plans to compete with the Taiwanese company in the foundry business, a tricky balancing act for the CEO.
Photo: Bloomberg
This is Gelsinger’s first trip to Asia since taking the top job at Intel earlier this year and comes as he publicly lobbies the US government to allocate money for the country’s chip industry to domestic companies only.
He has said that overseas manufacturers — such as TSMC and Samsung Electronics Co, which both have plans to build plants in the US — should not get money through the Chips Act, which is going through political approvals in Washington.
As part of those efforts, he has said that the concentration of advanced manufacturing in Taiwan is a strategic risk.
TSMC is both a threat to Intel and an interim solution to issues that have seen the US giant lose manufacturing leadership in the chip industry, the foundation of its dominance for three decades.
Rivals such as Nvidia Corp and Advanced Micro Devices Inc use TSMC’s production to make chips they say are better than Intel’s offerings. Market share losses and weak earnings from Intel have helped bolster their case.
Part of Gelsinger’s answer to that is a strategy for combining parts of processors made by TSMC with other contributions from his own factories to produce more competitive computer components.
At the same time he is investing heavily to improve his own production to the point where he should no longer need TSMC’s cutting-edge production.
He plans to open factories that would make semiconductors for other companies, which is the foundry business model that TSMC pioneered.
While that gives TSMC some leverage, it is also left with some tricky decisions. The kind of production that Intel wants, and the huge volume of orders it could provide, are potentially lucrative for the Taiwanese company. Intel still has about an 80 percent share of the computer processor market.
Gelsinger has said that competition and cooperation between companies is nothing new and technology is full of such arrangements.
Intel has long used TSMC for manufacturing of less-important support chips for computers and other parts of its portfolio.
TSMC’s rapid rise has been built on navigating the complex web of rivalries among its customers, of guaranteeing impartiality and of pushing forward production technology quickly. Its customers include Apple Inc, Qualcomm Inc, Sony Group Corp, as well as Nvidia and AMD.
Gelsinger is also to visit Malaysia, where COVID-19-related shutdowns of plants have hurt chip supply for many companies.
Intel relies on the Southeast Asian country for some of its chip packaging operations, the critical last step in the semiconductor manufacturing process.
AI TALENT: No financial details were released about the deal, in which top Groq executives, including its CEO, would join Nvidia to help advance the technology Nvidia Corp has agreed to a licensing deal with artificial intelligence (AI) start-up Groq, furthering its investments in companies connected to the AI boom and gaining the right to add a new type of technology to its products. The world’s largest publicly traded company has paid for the right to use Groq’s technology and is to integrate its chip design into future products. Some of the start-up’s executives are leaving to join Nvidia to help with that effort, the companies said. Groq would continue as an independent company with a new chief executive, it said on Wednesday in a post on its Web
RESPONSE: The Japanese Ministry of Finance might have to intervene in the currency markets should the yen keep weakening toward the 160 level against the US dollar Japan’s chief currency official yesterday sent a warning on recent foreign exchange moves, after the yen weakened against the US dollar following Friday last week’s Bank of Japan (BOJ) decision. “We’re seeing one-directional, sudden moves especially after last week’s monetary policy meeting, so I’m deeply concerned,” Japanese Vice Finance Minister for International Affairs Atsushi Mimura told reporters. “We’d like to take appropriate responses against excessive moves.” The central bank on Friday raised its benchmark interest rate to the highest in 30 years, but Bank of Japan Governor Kazuo Ueda chose to keep his options open rather than bolster the yen,
Even as the US is embarked on a bitter rivalry with China over the deployment of artificial intelligence (AI), Chinese technology is quietly making inroads into the US market. Despite considerable geopolitical tensions, Chinese open-source AI models are winning over a growing number of programmers and companies in the US. These are different from the closed generative AI models that have become household names — ChatGPT-maker OpenAI or Google’s Gemini — whose inner workings are fiercely protected. In contrast, “open” models offered by many Chinese rivals, from Alibaba (阿里巴巴) to DeepSeek (深度求索), allow programmers to customize parts of the software to suit their
Global server shipments are expected to surge to 15 million units next year, from 4 million units this year, with artificial intelligence (AI) servers accounting for about 30 percent, driven by massive capital spending by major cloud service providers, the Market Intelligence and Consulting Institute (MIC) said on Thursday last week. Major cloud service providers — including Google’s parent company Alphabet Inc, Microsoft Corp, Amazon.com Inc and Meta Platforms Inc — are projected to budget US$450 million for capital expenditure next year, up from US$400 million this year, MIC ICT [information and communications technology] Industry Research Center director Edward Lin
RSS