Two years after Intel deal collapsed, Tower Semiconductor hits $10 billion valuation
The Israeli chipmaker doubles in value, expands AI-focused production, and forecasts record revenue after $5 billion sale fell through.
The chipmaker Tower Semiconductor, which was nearly sold to Intel for $5 billion two years ago, appears to have no regrets about the deal’s collapse - its market value has now doubled to $10 billion.
The Migdal HaEmek–based company published strong third-quarter results, raised its fourth-quarter forecast, and simultaneously announced plans to expand production capacity with a $300 million investment.
The expansion will take place across four of Tower’s global fabrication plants, including one in Israel. The goal is to boost production of next-generation analog chips using SiPho (silicon photonics) and SiGe (silicon–germanium) technologies that support AI applications. Until now, these chips were produced exclusively at Tower’s Newport, U.S. facility, but the new investment will extend these capabilities to three additional plants worldwide.
Tower specializes in analog semiconductors, a distinct and profitable niche within the chip industry. Intel had sought to acquire Tower to strengthen its foundry services division for external customers, a unit that has struggled to scale independently since the deal’s collapse.
Intel ultimately withdrew from the acquisition after Chinese regulators refused to approve it, amid escalating U.S.-China trade tensions. Tower, however, emerged from the failed transaction with a $350 million breakup fee, effectively compensating it for the canceled deal.
Looking ahead, Tower expects record quarterly revenue of $440 million in Q4 2025, driven by what it described as “sweeping growth” in sales of its core technologies. This performance would represent a compound annual growth rate of 14%, bringing the company to $1.5 billion in annual revenue by the end of 2025.
In the third quarter, revenue reached $396 million, a 6% increase from the previous quarter. Net income totaled $54 million, or 48 cents per share, with both figures exceeding market expectations. Operating cash flow in the quarter reached $139 million.
