Intel’s foundry ambitions face critical test with Nvidia and Broadcom
Chip giants evaluate Intel’s 18A process as the company fights to regain industry relevance.
Chip designers Nvidia and Broadcom are conducting manufacturing tests with Intel, according to Reuters, signaling early confidence in the struggling company’s advanced production techniques.
These tests, which have not been previously reported, indicate that Nvidia and Broadcom are evaluating whether to commit hundreds of millions of dollars in manufacturing contracts to Intel. Such a decision could provide a major revenue boost and a significant endorsement for Intel’s contract manufacturing business, which has faced delays and has yet to announce a major chip designer as a customer.
Advanced Micro Devices is also assessing whether Intel’s 18A manufacturing process meets its needs, though it is unclear if AMD has submitted test chips for evaluation. AMD declined to comment.
An Intel spokesperson said, "We don't comment on specific customers but continue to see strong interest and engagement on Intel 18A across our ecosystem."
Nvidia and Broadcom are testing Intel’s 18A process, a cutting-edge manufacturing technology developed over several years that is designed for advanced AI processors and other complex chips. The 18A process competes with Taiwan’s TSMC, which dominates the global semiconductor market.
Nvidia declined to comment, and Broadcom did not respond to a request for comment.
These tests do not involve complete chip designs but rather focus on assessing the behavior and capabilities of Intel’s 18A process. Chip designers often purchase wafers to test specific components before committing to full-scale production. The testing phase can last several months, and it remains unclear when Nvidia and Broadcom began their evaluations.
However, manufacturing tests do not guarantee that Intel will secure new business. Last year, Reuters reported that a batch of Broadcom tests yielded disappointing results, raising concerns among its executives and engineers. At the time, Broadcom stated that it was continuing to review Intel’s foundry capabilities.
Challenges and Delays
The early endorsement from Nvidia and Broadcom comes amid potential further delays in Intel’s ability to produce chips for certain contract manufacturing customers, particularly those relying on third-party intellectual property (IP). According to two additional sources and documents reviewed by Reuters, Intel is struggling to qualify crucial IP components required for its 18A process, pushing back its timeline by at least six months.
Intel’s contract manufacturing business, or foundry, was a key pillar of former CEO Pat Gelsinger’s plan to revive the company. However, Intel’s board dismissed Gelsinger in December. Since then, Intel’s interim co-CEOs have mothballed its upcoming AI chip, delaying hopes for a viable in-house AI processor until at least 2027.
Intel’s challenges have also attracted attention from the U.S. government, which is keen on reviving domestic semiconductor manufacturing to counter China’s dominance. Intel is widely seen as the only viable U.S. company capable of producing the most advanced chips domestically.
Earlier this year, U.S. officials met with TSMC CEO C.C. Wei in New York to discuss a potential majority stake in a joint venture within Intel’s foundry business, according to a source familiar with the matter. The discussions also explored the possibility of other chip designers investing in the new venture.
TSMC declined to comment, and Intel did not respond to questions regarding the meetings.
Intel has previously stated that it signed deals with Microsoft and Amazon to produce chips on its 18A process, but details remain scarce. The company has not disclosed which Microsoft chip will be manufactured or the specific product for Amazon. It is also unclear how much manufacturing volume these agreements represent.
Setbacks in Intel's 18A Process
Intel had already delayed the 18A process to 2026 for potential contract manufacturing customers. Now, according to supplier documents and sources familiar with the situation, the company has pushed back the timeline by another six months.
The primary cause of the delay is the qualification process for crucial intellectual property needed for chip production. Small and mid-sized chip designers rely on these fundamental building blocks to develop their products, and without them, they will be unable to manufacture chips on Intel’s 18A process until at least mid-2026.
It remains unclear why the IP qualification process has been delayed. Qualifying IP involves ensuring compatibility with a specific manufacturing process, typically requiring extensive testing and validation.
Asked about the delay, Intel stated, "(We will) begin ramping production in the second half of this year, delivering on the commitments we have made to our customers." The company added that it expects its factories to begin receiving designs from customers later this year.
The Foundry Business in Limbo
Many chip designers are closely monitoring Intel’s foundry progress to determine whether they will eventually commit to using its manufacturing services.
Intel’s 18A process currently performs between TSMC’s most advanced process and its predecessor, according to Sassine Ghazi, CEO of Synopsys, a company that supplies essential intellectual property for Intel’s foundry.
"Right now, there are a lot of customers waiting—I'm talking about foundry customers—to see the state of Intel. Will I commit? Will I not?" Ghazi said.
A delay in ramping up production could stall much-needed revenue from Intel’s foundry business, which currently primarily produces Intel’s own chips. Analysts expect Intel’s foundry to generate $16.47 billion in revenue in 2025, but nearly all of that will come from internal operations rather than external customers.
Intel’s foundry revenue fell 60% in 2023, and the company has stated that it does not expect the business to break even until at least 2027.
