Foreign media pointed out that the gap between Intel and TSMC is not only in chip manufacturing, but also in market investment strategies, which represent two different investment paths. (Bloomberg, composite photo from this newspaper)
[Financial Channel/Comprehensive Report] As national security collides with manufacturing strength, the structure of the semiconductor industry is changing. Foreign media pointed out that investors must choose between the recovering US giant Intel (Intel) and the world's leading wafer foundry Taiwan Semiconductor Manufacturing Company (TSMC). As for which one is more suitable to buy in 2026, directly naming TSMC in the article seems to be a safer and more profitable choice.
The reasoning held by foreign media is that it makes little sense to pay the high valuation premium caused by the sharp rise in Intel's stock price, and the market demand for advanced chips is still strong, and TSMC is likely to continue to lead Intel, which has development potential but is still struggling.
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The report pointed out that both Intel and TSMC are at the core of the global supply chain, but for investors looking for growth or turnaround potential, they provide completely different investment paths; on one side are the U.S. chip giants that are undergoing transformation and continue to burn money, and on the other side are the leading wafer foundries that master high-end chip manufacturing and generated tens of billions of dollars in free cash flow last year.
Intel also designs and manufactures processors and software to serve the cloud, enterprise and edge computing markets, and continues to expand its foundry business to manufacture chips for other companies. In early 2026, after Intel decided to grant 10% of its equity to the US government, it faced huge litigation risks, making corporate governance and political factors additional risks.
Now shareholders have filed a lawsuit, alleging that the deal was designed to ease political pressure rather than serve investor interests. Additionally, Intel is still viewed as a struggling chipmaker, reflecting its ongoing struggles in regaining technology leadership and boosting market confidence.
In fiscal year 2025, Intel's revenue was close to US$52.9 billion (approximately NT$1.6 trillion), a decrease of approximately 0.5% from the previous year, with a net loss of approximately US$267 million (approximately NT$8.49 billion), and a net interest rate of negative 0.5%. This reflects that the company is still under huge capital expenditure pressure in promoting its foundry-first strategy.
As of December 2025, Intel's debt to shareholders' equity ratio is about 0.4 times, the current ratio is close to 2 times, and its short-term solvency is acceptable, but its free cash flow is still negative about US$4.9 billion (approximately NT$155.82 billion). In addition, stock-based compensation accounts for approximately 25.1% of operating cash flow. Since stock-based compensation is a non-cash expense, it is added back in the cash flow statement, thus increasing operating cash flow on the books.
In contrast, TSMC adopts a pure foundry business model, specializing in producing chips for other companies and not competing with customers. Its customers include smartphone, artificial intelligence and other advanced chip design companies, and can directly benefit from the overall industry's demand for high-end manufacturing processes.
TSMC faces risks arising from the concentration of manufacturing facilities in a single geographical area. Although the company did not disclose specific near-term risks in its 10-K filing, global supply chain disruptions and regional geopolitical tensions remain major concerns for the foundry. In addition, TSMC faces competitive pressure from Samsung and other rivals as they race to develop more efficient chip manufacturing processes.
In fiscal year 2025, TSMC’s revenue is close to US$122.4 billion (approximately NT$3.8 trillion), an annual increase of approximately 32%; net profit is approximately US$55.1 billion (approximately NT$1.7 trillion), and net profit margin is approximately 46.3%, indicating that demand for advanced processes remains strong. As of December 2025, TSMC's debt to shareholders' equity ratio is approximately 0.2 times, its current ratio is approximately 2.5 times, and its free cash flow is approximately US$32.2 billion (approximately NT$1.5), which means that after paying operating and capital expenditures, it still retains a large amount of cash.
The article pointed out that the biggest difference between the two companies is that they are currently at different stages. The core of Intel's investment story is whether it can regain its technology and market position through the transformation of wafer foundry. However, the company still faces losses, negative free cash flow, and legal disputes caused by the U.S. government's shareholding. TSMC has established an operating foundation of high profits, high cash flow, and leading advanced processes.
For investors, the choice between the two is essentially a trade-off between "transformation potential" and "existing profitability."
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