Intel’s outsourced OEM orders may be postponed

Highly anticipated by the market, Intel’s outsourcing orders, which were originally expected to be announced on the day of the earnings release meeting on January 21, will eventually be awarded to TSMC or Samsung. It may be postponed as Intel prepares to replace the CEO in mid-February. It will be officially announced by the new CEO.
 
According to foreign media reports, Intel officially announced that the current CEO Bob Swan will step down on February 15, 2021 after holding this position for more than one year. The current VMware CEO Pat Gelsinger, who was Intel’s chief technology officer, took over and became Intel’s eighth CEO in 50 years. And because the time when Pat Gelsinger takes over as CEO is not far from the time of the earnings release meeting, the related outsourcing orders will be announced by Pat Gelsinger.
 
In fact, foreign news agencies have previously reported that Intel has negotiated with TSMC and Samsung to discuss the outsourcing of some Intel chips. Among them, Intel may commission TSMC's foundry part, which is expected to start production in 2022 and officially go on the market in 2023. In this regard, foreign investment reports have pointed out that in the past year, Intel has launched some test wafer projects at TSMC, including the expected launch of graphics processors using 6nm process in the first half of 2021, and the estimated volume in the second half of 2021. Produced and applied in mobile platforms, using Atom core processors with 5nm process.
 
As for TSMC’s and Samsung’s competition for Intel’s outsourcing orders, the latest foreign report recently stated that Samsung’s process technology is at least three years behind TSMC, so Samsung will only get a small part of Intel’s outsourcing orders, most of which will be taken by TSMC. TSMC’s outsourcing production will be able to meet Intel’s 20% production demand and 8% revenue growth. For TSMC, Intel’s outsourcing orders can push TSMC’s 2023 EPS to NT$35 per share, and both profit and shareholder returns will hit new highs.
 
As for the South Korean media previously quoted market sources and reported that TSMC will have a competitive advantage over Samsung to compete for Intel’s outsourced manufacturing orders. The reason is that TSMC is a pure foundry manufacturer and does not engage in processor design. Therefore, TSMC will not directly compete with Intel, and it is relatively non-competitive, and the overall operation is safer. On the other hand, Samsung, because it also has a processor design business, the two parties are potential competitors and have more security concerns. Therefore, in the case of related advantages that favor TSMC, it may take some patience to look forward to the good news.