Intel Corp. (INTC) is ordering its 6-nanometer (nm) chips to be manufactured by TSMC (TSM) for next year, according to a report from the Taiwan-based newspaper Commercial Times.The news is considered unprecedented for Intel, a prominent chip manufacturer, now using a third-party manufacturer to create its own product. On July 23, Intel announced that it would see significant delays until 2022 for its latest cutting-edge 7-nm chip. Intel CEO Bob Swan said on a Q2 earnings call that the company has "invested in contingency plans to hedge against further schedule uncertainty" and that it could involve "somebody else's foundry."The Commercial Times report provides the first confirmation of Intel's "contingency plans" with a reported Intel order of 180,000 wafers from TSMC to produce its 6-nm chip. However, it was not clear who would be manufacturing the much delayed, 7-nm chip.The announcement last week overshadowed Intel's upbeat Q2 earnings and sent ripples across the Street with Intel's stock registering its worst drop since March with shares down 16% at market close on Friday at $50.59.Susquehanna analyst Christopher Rolland commented on the chip delay saying, "Given the new timeline, we believe it's near impossible for Intel to catch/surpass TSM in the next half-decade, accelerating competitive pressures [with] (AMD)." He added, "While not probable, we believe it makes sense for Intel to sell some of their leading-edge fabs to TSM, given the fungibility of Intel's state-of-the-art fabs/equipment." He maintains a Hold rating on Intel and cut his price target from $60 to $55, which implies 5% upside potential.Overall, 8 analysts assign Buy ratings, 15 Hold ratings, and 9 Sell ratings, giving INTC a Hold Street consensus. The average analyst price target stands at $57.20, suggesting 14% upside potential, with shares down 16% year-to-date. (See Intel's stock analysis on TipRanks).Related News: Advanced Micro Devices Surges To 52-Week High On Intel’s Woes Intel Faces Analysts’ Wrath, Stock Slips Over 16% AMD Jumps Over 8% On New Line Of Chips]AMD Jumps Over 8% On New Line Of Chips More recent articles from Smarter Analyst: * Hasbro Reports Q2 Earnings Drop; Shares Fall 7% * F5 Networks Beats 3Q Estimates, Stock Drops 4% in After-Hours * Rio Tinto Reveals Maiden Resource At Winu, New Gold Discovery * AMD Biggest Beneficiary of Intel’s 7nm Delay, Says 5-Star Analyst
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