Intel Bets Billions on Advanced Chip Packaging in New Mexico

The tech giant's ambitious plan to dominate the AI-driven packaging market faces challenges but promises big rewards.

Apr. 13, 2026 at 7:58am

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A highly detailed, glowing 3D illustration of an advanced semiconductor chip package, with intricate circuitry and luminous cyan and magenta lights emanating from the various components, conceptually representing the cutting-edge nature of Intel's advanced packaging technology.Intel's ambitious investment in advanced chip packaging technology aims to power the next generation of AI-driven computing.Rio Rancho Today

Intel has revived its dormant chip plant in Rio Rancho, New Mexico, with a multi-billion dollar investment in advanced chip packaging technology. This innovative approach combines multiple chiplets into a single, customized chip to meet the surging demand for computing power driven by the AI revolution. Intel's leadership is bullish on the potential, with the company's Foundry side now taking center stage as it negotiates deals with tech giants like Google and Amazon.

Why it matters

Intel's advanced packaging push is a strategic bet that could redefine the company's future and shake up the tech industry. As major tech firms venture into custom chip design, Intel sees an opportunity to capture a significant share of the burgeoning market. However, the success of this endeavor hinges on Intel's ability to secure deals, expand its operations, and navigate the complex challenges of chip packaging.

The details

Intel's advanced packaging technology, known as EMIB-T, promises improved power efficiency and signal integrity, positioning the company as a key player in the AI-driven packaging revolution. The company has effectively split itself into two entities, with the traditional 'product' side focused on designing and selling CPUs, while the Foundry side takes on the role of advanced semiconductor manufacturing. Intel's expansion plans extend beyond New Mexico, with the company also announcing an expansion of its chip-making facilities in Malaysia.

  • Intel announced its plans to revive the Rio Rancho chip plant in 2024.
  • The company is aiming to begin mass production of its EMIB-T packaging technology at the Rio Rancho facility in 2026.

The players

Lip-Bu Tan

CEO of Intel.

Dave Zinsner

CFO of Intel.

Jim McGregor

A veteran chip industry analyst.

Naga Chandrasekaran

Head of Intel's Foundry division.

John Hipsher

Intel spokesperson.

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What they’re saying

“We must let customers speak about Intel's products rather than the company boasting about its customer base.”

— Naga Chandrasekaran, Head of Intel's Foundry division

“Packaging is a complex and challenging endeavor. It's not as simple as running a certain number of wafers per month.”

— Jim McGregor, Veteran chip industry analyst

What’s next

Intel is currently in negotiations with tech giants like Google and Amazon, who are potential customers for its advanced packaging services. The success of these negotiations and Intel's ability to secure deals will be crucial in determining the future of its packaging business.

The takeaway

Intel's ambitious bet on advanced chip packaging in New Mexico represents a strategic shift for the company, as it seeks to capitalize on the growing demand for computing power driven by the AI revolution. The success of this endeavor will not only impact Intel's future but could also reshape the broader tech industry.