TSMC Founder Criticizes Intel’s Business Strategy, Advises Against Entering the Semiconductor Market

TSMC’s Founder, Morris Chang, has voiced strong criticism regarding Intel’s venture into chip manufacturing, suggesting that the company would have been wiser to concentrate on the burgeoning AI sector.

Morris Chang’s Take on Intel’s Business Strategy

Intel, often referred to as “Team Blue,”is currently facing significant challenges within the semiconductor industry. The firm is grappling not only with substantial financial setbacks but also with leadership uncertainties following the unexpected resignation of CEO Pat Gelsinger. Amid these turbulent times, Chang posits that Intel should have redirected its efforts away from foundry services and instead focused on artificial intelligence opportunities.

I don’t know why Pat resigned. I don’t know if his strategy was bad or if he didn’t execute it well… Compared with AI, he seemed to focus more on becoming a foundry. Of course, now it seems that (Gelsinger) should have focused on AI.

They currently have neither a new strategy nor a new CEO. Finding both is very difficult.

– TSMC’s Founder Morris Chang via Reuters

Chang’s statements reflect a significant shift in market dynamics, revealing how Intel, once a leader, has struggled to maintain its position in a rapidly evolving landscape. His comments underline concerns that the Intel Foundry Services (IFS) has yet to establish a foothold in mainstream markets, with the much-anticipated 18A node currently not meeting expectations.

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In contrast, Intel’s competitors, particularly AMD and NVIDIA, have adeptly positioned themselves in the AI landscape, boasting impressive portfolios that have led to considerable market share. Meanwhile, Intel’s Gaudi AI accelerators have failed to generate significant revenue, indicating a sluggish performance in AI compared to its rivals. This trend raises questions about the effectiveness of Intel’s diversified approach, often described as a “jack of all trades.”

With Gelsinger, a prominent supporter of the Intel Foundry initiative, stepping down, it is likely that the company will undergo a decisive shift in its business strategy. The focus may increasingly pivot towards strengthening its manufacturing capabilities, potentially sidelining its chip development ambitions for the foreseeable future.

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