Intel (INTC) held its first annual conference for its foundry business on Wednesday, with the chip maker partnering with chip designer Arm (ARM) and publicly traded technology giant Microsoft (MSFT) on the “AI Era'' announced the launch of its first system foundry. ) as Intel Foundry's newest customer among many updates. The company also mentioned its plans to become the world's second-largest foundry by 2030 and a boost from government funding as demand for artificial intelligence (AI) technology increases.
Microsoft becomes Intel Foundry's newest customer
Intel has named Microsoft as its latest customer for its custom chip business. The tech giant, which has established itself as a leader in the AI field, said it plans to produce chips using the Intel 18A process.
“We are in the midst of an incredibly exciting platform shift that will fundamentally change productivity for every individual organization and across industries,” Microsoft CEO Satya Nadella said at the event. He added that to achieve this vision, Microsoft needs a “reliable supply of cutting-edge, high-performance, high-quality semiconductors,” adding, “That's why we're so excited to work with Intel Foundry.” This is the chip design we plan to produce on the Intel 18A process.”
A partnership with Microsoft could help Intel establish itself as a major foundry while providing Microsoft with the hardware it needs to run its AI technology.
Intel said Intel Foundry's expected lifetime transaction value will total more than $15 billion across its wafer and advanced packaging divisions.
Intel announces collaboration with Arm
Intel also announced a partnership with chip designer Arm for Intel Foundry to provide cutting-edge foundry services for Arm-based systems-on-chips (SoCs).
The two companies will make a joint investment, with Arm saying it will contribute its IP at scale to “power the next wave of innovation.”
Arm shares have risen nearly 80% this year as the chip designer has captured investor attention as a key backer of the AI boom.
Aiming to become the world's second largest foundry by 2030
Intel said it is working to become the world's second-largest foundry by 2030, establishing a key strength in a market dominated by a few companies.
According to TrendForce statistics, the leader is Taiwan Semiconductor Manufacturing Company (TSM), which accounted for nearly 58% of the market in the third quarter of 2023.
In comparison, Intel Foundry captured 1% of the market over the same period. The top 10 foundries together account for approximately 95% of the market.
Government Contracts and CHIPS Act Funding
Intel reports that the U.S. government has awarded the company a $1 billion contract to “build this trusted and secure environment,” and the company expects to benefit from CHIPS Act funding. He said there was.
U.S. Secretary of Commerce Gina Raimondo also attended the event and said the Biden administration is working to improve the country's standing in the chip industry amid the AI boom.
Intel Foundry's growth could help the United States capture an even larger share of the global semiconductor manufacturing market, which is currently dominated by Taiwan, thanks in large part to TSMC.
Intel CEO Pat Gelsinger said Intel has not yet announced the CHIPS grant, but an announcement will be made “soon.”
