Intel Foundry Gains First Named Customer Under Lip-Bu Tan with Fortinet Silicon Contract
Fortinet will co-develop the Security Processor 6 with Intel using the Intel 4 process, marking the first public victory for the foundry under the new CEO. The announcement was made on Tuesday and repositions Intel against TSMC.
Intel and Fortinet announced a partnership on Tuesday to co-develop the Security Processor 6, the custom ASIC within FortiGate firewalls. The chip will be manufactured using the Intel 4 process and is the first externally named customer for Intel Foundry since Lip-Bu Tan took the helm in March 2025. Intel’s stock returned to $100 at the close of trading.
For Fortinet, this is an architectural decision, not a matter of patriotism. The SP6 is at the core of the company’s technical differentiation against Palo Alto Networks and Cisco in next-generation firewall: the more the ASIC handles deep inspection tasks traditionally run on CPUs, the greater the advantage in latency and cost per session. Ken Xie, CEO of Fortinet, stated in a release that the agreement encompasses "chip design, advanced packaging, and manufacturing," indicating a comprehensive contract rather than merely wafer procurement.
How Intel 4 Changes the Competition Against TSMC
The Intel 4 node is the foundry's first to utilize EUV lithography in commercial production and is the same process used by Intel in its own Meteor Lake chips. Until Tuesday, no external customer had agreed to sign a public contract using this node. Marvell, Microsoft, and Amazon have already tape-out network chips at TSMC N3E, the comparable node from the Taiwanese competitor, and none have migrated. The SP6 is the first evidence that a significant-volume customer has decided that the package Intel delivers offers competitive cost-effectiveness in network security, a market where wafer volumes are smaller than in GPUs but the margins per chip are higher.
The hierarchy of Intel Foundry still carries a political component. The U.S. Department of Commerce financed $8.5 billion in subsidies through the CHIPS Act conditional on building in Ohio, Arizona, and New Mexico. Lip-Bu Tan took office with an explicit mandate from the board to transform the foundry into an independent business with external customers, under the risk of Intel having to return part of the subsidy if it fails to meet third-party contracted goals. The Fortinet contract is the first public metric the board can cite without discomfort.
Where This Contract Fits in the Global Supply Chain
On the manufacturing side, the SP6 will be produced either from Ocotillo in Arizona or New Albany in Ohio, depending on the ramp of capacity that Intel has not publicly finalized. On the design side, Fortinet maintains its primary engineering in Sunnyvale, but part of the RTL verification takes place in Bengaluru, where the company expanded to 1,200 engineers in 2025. This is the same geography that TSMC competes in: American chips manufactured in the U.S. with collaborative design between Silicon Valley and India. The difference now is that the manufacturing is coming from Chandler or New Albany, not Hsinchu. For Fortinet's global procurement team, this setup also reduces exposure to export control that Washington has been tightening over network firmware manufactured in Taiwan and sold to allied defense entities.
In the European market, the perspective shifts. The partnership reinforces the argument Intel uses in discussions with the German BSI and the French ANSSI about "trustworthy origin silicon" for critical infrastructure. If a FortiGate running the SP6 manufactured in Arizona achieves certification from the BSI for use in the Bundeswehr, Intel opens a market that Palo Alto and Cisco have been competing for over the last three years with TSMC chips. In Asia, the symmetrical argument is already underway: Japanese banks overseen by the FSA have started to require silicon origin declarations in firewall RFPs starting in April, a clause that elevates American-manufactured suppliers on the priority list.
What Was Left Out of the Announcement
Intel and Fortinet did not disclose the contract value, wafer volume contracted, or production ramp timeline. They also did not mention whether the SP6 is exclusive to Intel 4 or if Fortinet maintains dual-sourcing at TSMC as a fallback. Bernstein analysts estimate that a foundry contract for such a complex security chip ranges between $300 million and $800 million over five years, depending on annual volume. If this range is correct, Fortinet accounts for less than 2% of Intel Foundry's revenue target through 2030, a small figure that carries a disproportionate symbolic weight: the first customer is the most challenging to secure.