Intel has secured a substantial chip manufacturing deal with Amazon Web Services (AWS), marking a significant win for Intel's foundry business, which has faced challenges in attracting marquee clients in recent years. This partnership will see Intel producing custom artificial intelligence (AI) chips designed by AWS for their data centers. The chip production will utilize Intel's cutting-edge 18A process, its most advanced technology.

The deal is an important step in Intel CEO Pat Gelsinger's plan to revive the company’s foundry division. Intel is aiming to regain its position in the highly competitive semiconductor industry, where it has lost market share to rivals like TSMC and Samsung. Amazon’s selection of Intel as its manufacturing partner signals confidence in Intel's ability to deliver on critical infrastructure for cloud computing services.

AWS has been designing its own chips to optimize performance in its growing cloud services division, which plays a key role in global cloud infrastructure. With Intel’s advanced manufacturing capabilities, AWS will be able to leverage custom chips to enhance its offerings in artificial intelligence and data processing, maintaining its edge in the cloud computing market.

This partnership is also crucial for Intel as it continues to restructure internally, with plans to make its foundry business more independent. Intel is also set to benefit from U.S. government support under the CHIPS and Science Act, receiving up to $3 billion in funding. This move comes at a time when Intel is grappling with layoffs and restructuring efforts aimed at cutting costs and prioritizing core technologies.

The collaboration between Intel and Amazon could reshape the competitive landscape in both cloud computing and chip manufacturing, making this deal a major milestone in Intel's efforts to re-establish itself as a dominant player in the semiconductor industry.

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