Nvidia and Broadcom, two leading chip designers, are reportedly testing Intel’s 18A manufacturing process, signaling a potential shift in the semiconductor landscape. These tests indicate that Nvidia and Broadcom are evaluating whether to commit hundreds of millions of dollars to manufacturing contracts with Intel. This move could provide a significant boost to Intel’s contract manufacturing business, which has faced setbacks and has yet to secure a prominent chip designer as a client. The decision by Nvidia and Broadcom could lead to a substantial revenue increase and provide crucial validation for Intel’s manufacturing capabilities.

Intel’s 18A process is a cutting-edge technology designed for producing advanced artificial intelligence processors and other complex chips. It features RibbonFET transistors and PowerVia backside power delivery, positioning it as a competitor to Taiwan Semiconductor Manufacturing’s (TSMC) similar technology. Sources suggest that the performance characteristics of Intel’s 18A process fall between TSMC’s current and next-generation nodes, creating a competitive window of opportunity for Intel. While Nvidia and Broadcom’s tests are not being conducted on complete chip designs, they aim to assess the behavior and performance of the 18A process.

The interest from Nvidia and Broadcom underscores the increasing importance of diversifying chip manufacturing sources. TSMC has been the dominant player in chip manufacturing for many years, but geopolitical factors and the desire for supply chain resilience are driving companies to explore alternatives. By partnering with Intel, U.S.-based companies like Nvidia and Broadcom could reduce their reliance on overseas manufacturing and bolster the domestic chip industry. Advanced Micro Devices (AMD) is also reportedly evaluating Intel’s 18A process, though it remains unclear whether they have sent test chips for production.

Despite the positive developments, Intel faces challenges in its foundry strategy. Reports indicate potential delays in delivering chips for some contract manufacturing customers due to issues with third-party IP providers. However, Intel maintains that it is on track to begin fabricating chips in the second half of this year. Securing high-profile customers like Nvidia and Broadcom would provide the market validation necessary for Intel to sustain continued investment in its foundry infrastructure, which has seen declining revenues and profitability.