October 2024

Taiwan Semiconductor Manufacturing Company Limited (TSMC) – a Taiwanese company- is the world’s second-most valuable semiconductor company and the world’s largest dedicated independent (“pure-play”) semiconductor foundry.

A recent report from Reuters (via TweakTown) reveals that Intel CEO Pat Gelsinger’s insensitive remarks about Taiwan’s status in relation to China may have cost the company millions in discounts from Taiwan Semiconductor Manufacturing Company (TSMC).

In an interview with *Fortune* magazine, Gelsinger remarked on using TSMC to fabricate Intel chip wafers, stating, “You don’t want all of your eggs in the basket of a Taiwan fab. […] Taiwan is not a stable place.” Unsurprisingly, these comments were poorly received in Taiwan, a nation claimed by the ruling party in neighboring China.

Before these remarks, Reuters sources indicated that Intel had been benefiting from a substantial 40% discount on 3-nanometer wafers. While TSMC publicly downplayed Gelsinger’s comments, with founder C.C. Wei calling him “a bit rude,” behind the scenes, TSMC decided to withdraw the discount previously offered to Intel, which amounted to about 40% off the $23,000 price for the 3nm wafers.

Officially, TSMC and Intel maintain a close partnership, as TSMC accounts for over 60% of the chip manufacturing market. However, this relationship may be under strain as Intel attempts to establish its own fabrication facilities, a goal it has yet to achieve.