TSMC Founder Remarks on Intel's Business Direction towards Contract Manufacturing

Morris Chang, the founder of Taiwan Semiconductor Manufacturing Co. (TSMC), remarked that Intel should have prioritized artificial intelligence (AI) over its attempts to become a contract chipmaker. His comments came in the wake of Intel CEO Pat Gelsinger's recent departure, which Chang linked to the company's evolving strategic challenges.

Speaking at an event to promote his autobiography, Chang stated that he was unaware of the exact reasons behind Gelsinger's resignation. However, he suggested that Intel's decision to focus heavily on the "foundry" business model, where chips are manufactured for other companies, might have been a misstep. Gelsinger had aimed to reclaim Intel's lost dominance in this space, which is currently led by TSMC, the world’s largest contract chip manufacturer. Chang noted, "Compared with AI, he seemed to focus more on becoming a foundry. Of course, now it seems that [Gelsinger] should have focused on AI."

Gelsinger's tenure was marked by ambitious but costly plans to revitalize Intel, including building a robust foundry business and enhancing AI capabilities for major clients. However, the company faced setbacks, including lost contracts and strained relationships with industry peers. Chang alluded to Gelsinger's management style, describing him as "a bit rude" in dealings with TSMC, according to a Reuters report from October.

Intel has yet to outline its future direction or announce a new CEO, a task Chang described as "very difficult." The company's board had grown dissatisfied with the slow progress under Gelsinger, leading to his ouster earlier this month.

Reflecting on Intel's history, Chang also shared insights from his recently released memoir, which chronicles TSMC's journey and its relationships with major customers like Apple and Qualcomm. Notably, he recalled how Intel had declined an invitation to invest in TSMC during the 1980s before eventually becoming one of its key customers.