Foundry

Intel and AMD are reportedly in early talks regarding AMD potentially using Intel’s foundry services. This news boosted Intel’s shares by 7%. Securing AMD as a client would be a major win for Intel, validating its foundry strategy and attracting further investment. It would also signify significant trust from AMD, a direct competitor in the processor market. Diversifying to Intel could improve AMD’s supply chain. Intel’s foundry ambitions are supported by government and Nvidia investments as signals of confidence in Intel’s turnaround, boosting its shares nearly 77% year-to-date. Both companies declined to comment.

Intel received a $5.7 billion U.S. government investment as part of a White House initiative taking a 10% equity stake. CFO David Zinsner also suggested exploring outside investment for Intel’s foundry business, a key growth area. While Q2 results beat expectations, shares dropped due to foundry capital intensity concerns. Intel cautioned that the deal could face “adverse reactions” from stakeholders, including investors and foreign governments, and increased scrutiny. The White House acknowledges the deal is still being finalized.

Intel’s foundry ambitions face disruption as three key manufacturing executives are reportedly retiring: Kaizad Mistry, Ryan Russell, and Gary Patton. Mistry and Russell oversaw process technology development, while Patton focused on design platform solutions for foundry clients. These departures create a knowledge gap in Intel’s manufacturing roadmap, crucial for attracting external customers to Intel Foundry Services (IFS). Intel is also reportedly reviewing its technology development structure, potentially streamlining capacity planning and reducing engineering headcount.

Samsung has reportedly delayed its 1.4nm test line construction, potentially pushing production rollout to 2028 due to market headwinds and its foundry business’s financial losses. The company is now focusing on its 2nm process, aiming for mass production by year-end, and pursuing orders from top suppliers like Tesla and Qualcomm. They plan to deploy the 2nm process at their new Texas facility.