Google reportedly orders at least three million chips from Intel to arrive in 2028, as TSMC struggles to keep up with the AI boom
Despite a rough couple of years for the company, Intel could be set to make a turnaround with both its handheld chips performing well, and its Foundry business taking on substantial orders, at least if recent reports prove to be true. The AI boom has placed significant strain on TSMC, the world's leading semiconductor manufacturer, and Intel is now being tapped to provide some of the chips in its place.
According to reports from The Information, Google has reportedly ordered at least three million chips from Intel in the form of TPUs (Tensor Processing Units). These are custom-designed units created for use in neural network machines. For those unfamiliar, this marks another significant commitment by Google to AI development and infrastructure. The TPUs will not only support Google's internal AI initiatives but will also be sold to external companies such as Apple and Meta.
Google is expected to produce over six million TPUs between 2027 and 2028, which means it will need to rely on both TSMC and Intel to meet this demand. However, TSMC has been unable to keep up with the rising demand for these specialized chips, creating an opportunity for Intel to step in and expand its market share.
Intel's Growing Influence in the Semiconductor Market
Intel’s position in the semiconductor industry is evolving rapidly, particularly with the rise of AI and the increasing demand for specialized chips. The company has been working to establish itself as a major player in the foundry business, competing directly with TSMC. This recent deal with Google could be a major boost for Intel, especially as it tries to secure more contracts in the AI and gaming sectors.
Nvidia, a key player in the GPU market, is reportedly testing Intel’s chips for use in its next major project. This project, codenamed Feynman, involves combining four graphics chips into one unit. If Intel can win this contract, it could significantly enhance its presence in the gaming market and further solidify its role as a key foundry for high-performance computing.
TSMC's Struggles and Expansion Plans
TSMC has long been the go-to manufacturer for the world's most advanced chips, but the AI boom has created a bottleneck in its production capabilities. The company is reportedly sold out until at least 2028, with even its Arizona fab being fully booked before it is completed.
Last year, TSMC announced a $100 billion investment plan for three new U.S.-based fabrication plants. However, it’s not the only semiconductor company expanding its capacity. Just last week, Intel announced plans to invest $3.3 billion in a new factory in India, signaling its intent to expand its global footprint.
Both companies are looking to ride the wave of AI demand, but the question remains whether this expansion will be enough to stabilize supply chains and meet the growing needs of the tech industry. As the demand for AI and gaming chips continues to rise, the race to keep up with production will only intensify.
