Intel may face risk of spin-off, TSMC and Broadcom seek acquisition opportunities

Intel could face risk of spinoffs as Broadcom and TSMC are exploring possible acquisition deals that could separate the U.S. chip maker, The Wall Street Journal reported. TSMC is currently considering a stake in Intel's foundry service division, while Qualcomm and Broadcom are also investing in enhancing Intel's manufacturing capabilities.

Broadcom has reviewed Intel's chip design and marketing operations and discussed possible bids with consultants. However, sources noted that Broadcom is unlikely to continue to propose acquisition proposals for Intel's manufacturing division without finding a partner.

In addition, TSMC is systematically considering acquiring some or all of Intel's chip factories, which may be conducted through an investor alliance or other structure. However, the discussion between TSMC and Intel is still in its preliminary and informal stages.

Intel's interim executive chairman Frank Yeri is in talks with potential investors and Trump administration officials. Yeri said his main focus is maximizing value for Intel shareholders. However, the White House expressed concerns about foreign control of Intel's U.S. factories. A White House official told Reuters that the government is unlikely to support foreign companies in operating Intel's factories.

Despite the government's support for foreign investment in U.S. manufacturing, national security remains a priority. Driven by the Biden administration, the United States is committed to returning the chip manufacturing industry to the country, a move that has helped Intel. In November last year, the U.S. Department of Commerce said it was finalizing a $7.86 billion subsidy for Intel.

Bloomberg reported that the Trump team recently discussed a deal with TSMC with Intel, and TSMC showed a positive attitude. In recent years, Intel has faced a series of challenges under pressure from contract loss and intensified competition, with major competitors including Nvidia and AMD. Former CEO Pat Kirsinger was fired last year and had high hopes for Intel's manufacturing and artificial intelligence capabilities, but failed to achieve it, causing the company to face financial and operational difficulties.

In the latest financial report, Intel's revenue was $14.26 billion, surpassing market expectations of $13.81 billion, but revenue fell 7% compared with the same period last year. This is the third consecutive quarter of Intel's revenue decline. The company reported a net loss of $126 million, with a loss of 3 cents per share, compared with a net profit of $2.67 billion, with a earnings of 63 cents per share in the same period last year.