The tests conducted by Broadcom involved sending silicon wafers - the foot-wide discs on which chips are printed - through Intel's most advanced manufacturing process known as 18A, the sources said. Broadcom received the wafers back from Intel last month. After its engineers and executives studied the results, the company concluded the manufacturing process is not yet viable to move to high-volume production.

Reuters could not determine the current relationship between Broadcom and Intel or whether Broadcom had decided to walk away from a potential manufacturing deal.

"Intel 18A is powered on, healthy and yielding well, and we remain fully on track to begin high volume manufacturing next year," an Intel spokesperson said in a statement. "There is a great deal of interest in Intel 18A across the industry but, as a matter of policy, we do not comment on specific customer conversations."

A Broadcom spokesperson said the company is "evaluating the product and service offerings of Intel Foundry and have not concluded that evaluation."