(Bloomberg) — Nvidia Corp., one of the largest buyers of outsourced chip production, said it will explore using Intel Corp. as a possible manufacturer of its products, but said Intel’s journey to becoming a foundry will be difficult.
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Nvidia Chief Executive Officer Jensen Huang said he wants to diversify his company’s suppliers as much as possible and will consider working with Intel. Nvidia currently uses Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co to build its products.
“We’re very open-minded to considering Intel,” Huang said Wednesday in an online company event. “Foundry discussions take a long time. It’s not just about desire. We’re not buying milk here.”
Intel jumped to a session high on the news. CEO Pat Gelsinger announced last year that the chipmaker, once the world’s technical leader, would seek to construct new factories and manufacture products for others, even rivals.
Huang said Intel’s effort to compete with the two Asian companies as a foundry operator will require more than building plants, it will have to fundamentally change its culture and operations.
“Being a foundry at the caliber of TSMC is not for the faint-hearted,” he added. “TSMC dances with the operations of 300 companies worldwide.”
Intel will need to learn to attune itself to the way that customers want to work, which hasn’t been part of the company’s experience as it makes chips of its own design, Huang said. Nonetheless, moving into the business of being an outsource manufacturer is something that Intel has to do, he said.
Intel shares rose as much as 2.5% to $49.58 in New York trading. Nvidia stock was little changed at $263.75
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Source: https://finance.yahoo.com/news/nvidia-consider-using-intel-foundry-161550456.html