TSMC CEO Comments on Competitor as a Valued Customer, Subtly Addressing Intel’s Spotlight

During a recent discussion, TSMC’s CEO, C. C.Wei, addressed the growing attention on Intel, which has been fueled by investments from key players like NVIDIA. He noted that Team Blue operates concurrently as both a competitor and a significant customer of TSMC.

Intel’s Ongoing Relationship with TSMC: No Plans to Change

The backdrop of this narrative reveals that many in the industry perceive Intel’s foundry services as emerging rivals to TSMC’s well-established offerings. Notably, during the Q3 earnings call, Wei offered insightful commentary on TSMC’s competitive position, subtly addressing Intel’s aspirations while expressing confidence in TSMC’s enduring leadership, particularly through innovations like Foundry 2.0. This is how he encapsulated the relationship when queried about TSMC’s commitment to its US clients, including Intel:

Talking about our competition in the US, well, that competitor is happened to be our customer, very good customer. So in fact, we are working with them to for their both advanced product. Other than that, I don’t want to make any more comment.

Wei’s remarks underscore a fundamental truth: Intel is significantly dependent on TSMC for its flagship consumer technologies. The tech giant has consistently confirmed its intent to leverage TSMC’s capabilities for its semiconductor needs, evident in projects like Nova Lake. Hence, Wei’s observations ring true, as the prospects for Intel to emerge as a formidable challenger to TSMC hinge on its ability to develop competitive chip manufacturing processes and establish adequate foundry capabilities—a scenario that remains uncertain.

Intel’s ambitions to emerge as a competitor to TSMC do not seem to unsettle the Taiwanese powerhouse, primarily because TSMC has mastered the intricacies of the semiconductor ecosystem as a whole—not merely its production segment. TSMC’s comprehensive approach encompasses dedicated processes for packaging, testing and validation, mask-making, and various back-end operations. This diversification has poised the company to dominate an expansive addressable market, enhancing its control over the supply chain. Consequently, any potential competitors must deliberate carefully before deciding to switch suppliers, such as the emerging Intel Foundry Services (IFS).

Although TSMC does face challenges like capacity constraints that could afford its competitors the opportunity to carve out their market share, its pivotal role in the foundry sector is undeniable. As TSMC continues to innovate and expand, its influence within the semiconductor industry is destined to grow even further.

Source & Images