SoftBank calls off Intel AI chip partnership talks

Intel has reportedly struggled to meet SoftBank’s production volume and speed requirements

SoftBank has ended discussions with Intel about designing an artificial intelligence (AI) chip that will rival those released by Nvidia. SoftBank sought a partnership with Intel to help it achieve a leadership position in the AI space, but U.S. chipmaker has reportedly struggled to meet the Japanese company’s production volume and speed requirements.

It remains unclear what SoftBank’s next move will be and how much this decision marks a shift in its strategy or simply a loss of faith in Intel as a partner. It’s true that the company has experienced some recent setbacks, particularly around AI. A recent SEC filing, for instance, revealed that Intel sold its stake in British chip firm Arm Holdings in Q2. And this news hit the stands amid the massive job cuts taking place at the company. In conjunction, these developments have signaled for many that a larger shakeup is underway at Intel struggles to keep pace with competitors like AMD and Qualcomm.

However, Intel is in line to receive as much as  $8.5 billion in US government funding thanks to the CHIPS and Science Act, and if SoftBank had committed to using the company’s U.S. foundry to manufacture AI chips, it too could have tapped into this funding. While SoftBank was clear that Intel is responsible for the failed talks, Chief Executive Masayoshi Son did suggest discussion may startup again just because there are so few manufacturers capable of producing advanced AI processors. According to the Financial Times, though, Taiwan Semiconductor Manufacturing Company (TSMC) has emerged as Son’s possible next target.