Intel seeks foundry alliance with Samsung, says report

Intel CEO Pat Gelsinger has requested an in-person meeting with Samsung Electronics chair Lee Jae-yong to discuss “comprehensive cooperation measures in the foundry sector,” according to Korea’s Maeil Business newspaper.

If established, an Intel-Samsung foundry alliance would enable the exchange of manufacturing process technologies, sharing of production facilities around the world and R&D collaboration, the report said.

An alliance would be a move to counter the outstanding success achieved by TSMC at the 5nm and 3nm processing nodes. There have been rumors that Intel and Samsung have struggled to win any customers at 3nm and 20A nodes in competition against TSMC. Samsung

For many years Intel was the technology and market leader in semiconductors driven by its x86 processor sales in PCs. However, over the last decade or so the company has fallen behind in chip making and failed to compete with Nvidia in AI. Having been an IDM Intel is a relatively recent entrant into the foundry market.

Samsung is also an IDM and the market leader in memory chips but it too has struggled to persuade customers that its manufacturing processes are competitive with those of TSMC.

Samsung senior management took the unusual step of apologizing to customers, investors and employees as part of the delivery of recent financial results.

“The leadership team at Samsung Electronics wishes to apologise for not meeting your expectations with our performance. We have caused concerns about our technical competitiveness, with some talking about the crisis facing Samsung. As leaders of the business, we take full responsibility for this,” Young Hyun Jun, the head of Samsung’s chip division, wrote in a letter.

The newspaper said that on Monday October 21 a high-ranking Intel executive asked Samsung Electronics to consider a meeting between the two top executives of the company. This could be the beginning of a resource sharing within Intel and Samsung but could also represent the beginning of a move by Intel to dispose of its manufacturing operations. This is something observers have been discussing as the former chip market leader has produced a series of weak financial results in 2024.

TSMC held 62.3 percent foundry market share in the 2Q24 with Samsung ranked second with 11.5 percent, according to TrendForce. Intel did appear in the market researcher’s top-ten ranking.

Samsung has overseas manufacturing facilities in China and the US but has reportedly been pushing back on orders for EUV lithography equipment due to a lack of orders.

Intel has overseas wafer fabs in Ireland and Israel but as had to postpone the building of two fabs in Magdeburg, Germany  

Neither Samsung Electronics nor Intel would confirm any meetings between top officials, the Maeil Business reported.