Intel (NASDAQ:INTC) has been on a tear, climbing more than 24% over the past week as rumors swirl about a potential collaboration with Taiwan Semiconductor (NYSE:TSM) on its foundry operations.

Despite the buzz, Citi analyst Christopher Danely isn't convinced such a deal would work. He pointed to major operational and cultural hurdles, noting that Intel employees would have to follow TSMC's processes and leadership. Additionally, Intel's manufacturing approach differs significantly from TSMC's, making integration challenging. Lastly, Intel workers would likely have to adopt completely foreign working arrangements that exist in Taiwan, such as living near the factory and being available at a moment's notice, Danely wrote in a client note.

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Intel has struggled to compete with Taiwan Semiconductor and other major foundries. In its most recent quarter, Intel Foundry generated $4.5 billion in revenue, mostly from its own chip designs. The company is also expanding its customer base, recently announcing plans to manufacture chips for Amazon (NASDAQ:AMZN) Web Services.

Even as Intel explores new opportunities, Taiwan Semiconductor remains the dominant AI chip manufacturer. The company has a facility in Arizona and has reportedly been in talks with Nvidia (NASDAQ:NVDA) about producing its Blackwell GPUs at the site. Danely, who maintains a Neutral rating on Intel, believes the company should step away from the foundry business and focus on its core strength: microprocessors.