AMD and NVIDIA Excluded from Intel’s $52 Billion CHIPS Act Bonanza

Intel has made a big deal out of the $52 billion CHIPS Act, which would boost domestic semiconductor production within the U.S. considerably. Taiwan Semiconductor Inc. (TSMC) has emerged as the dominant force in the contract chipmaking sector globally, and Intel is eager to reclaim the market share it has lost in recent decades.

However, a few in the U.S. semiconductor industry believe that the version of the CHIPS Act set to be voted on by the Senate as early as tomorrow unfairly benefits Intel.

According to Reuters, the bill’s $52 billion in subsidies and tax breaks will provide the majority of the benefits to companies like Intel. The majority of Intel’s semiconductors are designed and manufactured in the United States, and the CHIPS Act strongly favors off-setting the cost of building new production plants in the United States.

AMD and NVIDIA are Intel’s most direct competitors in the client computing, graphics, and server/HPC markets. While AMD and NVIDIA are based in the United States and design their microprocessors, they outsource chip production to companies such as TSMC and Samsung. As a result, they would not be able to fully benefit from the $52 billion windfall from the United States government.

Intel CEO Pat Gelsinger has pushed hard for the CHIPS Act to pass, even threatening to pull out of the Ohio fab if the bill fails.

“We’ve made it abundantly clear to McConnell, the Democrats, and the Republicans that if this doesn’t pass, I’m going to change my plans,” Gelsinger said last week. “The Europeans have moved forward aggressively, and they are ready to provide us with the incentives we need to move forward.”

Moreover, Pat has also highlighted the benefits of the CHIPS Act in a tweet and insisted to see it passed:

The United States House of Representatives is currently debating a version of the FABS Act that would benefit companies such as AMD and NVIDIA by providing tax breaks for aspects of semiconductor design. Even if those provisions were added, Intel would still benefit the most from the CHIPS and FABS Acts than its competitors.

Muhammad Zuhair
Passionate about technology and gaming content, Zuhair focuses on analysing information and then presenting it to the audience.