Wall Street is abuzz with speculation that iconic U.S. chipmaker Intel could be on the chopping block, with potential buyers eyeing different parts of its business. The news has sent Intel stock soaring, rising 10% to $25.97 in morning trades, as investors weigh the implications of a potential breakup.
Broadcom and TSMC Eyeing Intel’s Crown Jewels
According to a report from The Wall Street Journal, Broadcom and Taiwan Semiconductor Manufacturing Company (TSMC) are exploring separate deals that would effectively split Intel. Broadcom is reportedly interested in Intel’s chip-design business, which could complement its existing portfolio. Meanwhile, TSMC is eyeing Intel’s chip-manufacturing division, despite concerns about low synergy and geopolitical challenges.
Why Broadcom and TSMC Want a Piece of Intel
Broadcom’s interest in Intel’s x86 PC and server processor design business is particularly noteworthy. Bernstein analyst Stacy Rasgon suggests that while this segment is “potentially ex-growth,” Broadcom CEO Hock Tan could drive significant efficiencies, aligning with Broadcom’s strategic objectives. However, the manufacturing arm remains a challenge, burdened by heavily negative gross and operating margins.
For TSMC, acquiring Intel’s chip manufacturing business would bolster its position as the world’s leading semiconductor manufacturer. Yet, geopolitical tensions and complex regulatory requirements, especially from China, pose significant hurdles.
Intel Stock Analysis: Mixed Ratings Amid Breakup Speculation
The buzz around a potential breakup has prompted varied reactions from Wall Street analysts:
- BofA Securities Analyst Vivek Arya maintained his underperform rating on Intel with a price target of $19, cautioning that the breakup scenarios could be “time-consuming and complicated.” He also noted potential risks for Broadcom, including added debt and regulatory scrutiny.
- Bernstein Analyst Stacy Rasgon reiterated a market perform rating on Intel with a price target of $25, emphasizing the strategic fit for Broadcom but highlighting challenges in manufacturing.
- Evercore ISI Analyst Mark Lipacis raised his price target on Intel to $27 from $22, reflecting a “sum-of-the-parts” valuation, suggesting that investors are starting to see more value in Intel’s individual business units.
What’s Next for Intel?
The speculation has fueled renewed interest in Intel’s stock, which recently rebounded from a 2025 low of $18.73, close to its 15-year low of $18.51. As investors and analysts continue to debate the likelihood and implications of a breakup, all eyes are on how Intel’s leadership will respond to these high-stakes takeover rumors.
