Former Intel CEO Pat Gelsinger has cast doubt on Taiwan Semiconductor Manufacturing Company’s (TSMC) recent $100 billion investment pledge in the United States, arguing that it will do little to restore the country’s global leadership in chip manufacturing.
Speaking after his transition to venture capital firm Playground Global, Gelsinger emphasized that the U.S. must prioritize research and development (R&D) if it wants to regain dominance in the semiconductor industry. “If you don’t have R&D in the U.S., you will not have semiconductor leadership in the U.S.,” he said, pointing out that TSMC’s core R&D remains in Taiwan with no plans to relocate it.
TSMC’s investment was recently hailed by the White House as a major step toward bolstering U.S. semiconductor production. The Trump administration, in particular, has leaned on TSMC to expand its presence in the U.S., amid concerns about Intel’s ability to reclaim its manufacturing edge over the Taiwanese giant. While Gelsinger acknowledged that former President Donald Trump’s tariff policies had “incrementally beneficial” effects in encouraging more domestic chip production, he maintained that without deep R&D investments, the U.S. will continue to lag.
Gelsinger’s remarks follow his departure from Intel late last year, a move widely seen as a rejection of his ambitious turnaround plan, which aimed to rebuild Intel’s manufacturing capabilities. His successor, Lip-Bu Tan, has yet to unveil a clear strategy for the company’s future. Gelsinger refrained from confirming whether he had clashed with Intel’s board over strategy but indicated that he lost their confidence before completing his five-year roadmap.
Despite falling behind in semiconductor process technology, Gelsinger remains optimistic about America’s lead in emerging technologies such as artificial intelligence (AI). He dismissed recent concerns over Chinese AI company DeepSeek, which made headlines with its cost-efficient AI breakthroughs, stating that its advancements were “good engineering, not core innovations.”
Gelsinger’s new role at Playground Global positions him at the forefront of investments in quantum computing and advanced chipmaking technologies. Startups backed by the firm include xLight, which specializes in next-generation laser technology for semiconductor lithography, and PsiQuantum, a quantum computing company aiming to build large-scale quantum machines. Additionally, Playground supports d-Matrix, a startup developing AI inference chips designed to challenge Nvidia’s dominance in the sector.
While at Intel, Gelsinger struggled to close the gap with Nvidia in AI chip development, a shortfall he acknowledges needs to be addressed industry-wide. He argues that AI remains prohibitively expensive and that significant cost reductions are essential for its widespread deployment. “AI, as exciting as it is, is much too expensive,” he said. “We have to have dramatic reductions in the cost of inference for it to be truly deployed in every aspect of humanity.”
As the semiconductor industry navigates geopolitical tensions, supply chain disruptions, and increasing demand for AI capabilities, Gelsinger’s comments highlight a crucial debate: Can manufacturing incentives alone reestablish the U.S. as a chipmaking leader, or must the country double down on foundational R&D? According to the Financial Times, which first reported on Gelsinger’s stance, the answer lies in long-term investments in cutting-edge innovation rather than solely in manufacturing expansion.
