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Intel’s foundries will provide substantial capacity for MediaTek in both Europe and North America.

Intel will produce chips for MediaTek, making it the American giant’s first leading silicon client for its revitalized chip-manufacturing business. MediaTek is a major Taiwanese fabless semiconductor company.

Intel expects MediaTek to be the customer champion for its newly established foundry services. Intel rebooted its business to contend with foundry goliaths Samsung and TSMC.

A blend of east and west

In 2021, MediaTek was among the world’s five leading fabless chip designers, larger than Advanced Micro Devices (AMD), but less significant than Qualcomm, Nvidia and Broadcom. The company’s revenue soared to $17.6B – a staggering 61 percently annual increase – due to smartphone chip sales.

Besides Android handsets, the Taiwanese Designer also develops chips for Chromebooks, networking products, cars, tablets, and other smart home and IoT devices.

Intel said this deal would offer MediaTek a resilient, balanced supply chain as they’ll provide substantial production capacity in Europe and the US. MediaTek executive NS Tsai said this move is a part of a “multi-sourcing strategy”. It means they will continue using rival foundries like TSMC for various other products too.

“With its commitment to major capacity expansions, [Intel Foundry Services] provides value to MediaTek as we seek to create a more diversified supply chain”, said Tsai, head of the company’s platform technology and manufacturing operations. “We look forward to building a long-term partnership to serve the fast-growing demand for our products from customers across the globe.”

A new road for Intel

Intel spokesperson Jason Gorss said the company anticipates the engagement will result in “significant wafer volumes and revenue”. Intel specified that MediaTek will employ Intel’s advanced process techs to manufacture “multiple chips for a range of smart edge devices”.

The Intel foundry division (IFS) brought $283M in sales in the first three months of 2022, a small percentage of the $18.4B that the entirety of Intel recorded in that period. The partnership with MediaTek may help Intel transform from an integrated device manufacturer (IDM) into a hybrid IDM-foundry business.