Loss-making Intel is selling off its Network and Edge Group (NEX) as a standalone business, as part of new CEO Lip-Bu Tan’s ongoing plans to restructure the company.
Before news of the sell-off, Intel posted a $2.9 billion quarterly loss and announced a 15% cut in its workforce. The company laid off 15,000 staff last year.
NEX, which generated $5.8 billion in sales last year, provides networking silicon, Ethernet, and communications hardware. Tan’ doesn’t see NEX as a part of the company’s new AI-first strategy. Intel is looking for a strategic investor for NEX, while Intel will remain an “anchor investor”.
“Backed by Intel, this new, independent company will be positioned to accelerate its customer-facing strategy and product roadmap by innovating faster and investing in new offerings,” said Sachin Katti, NEX’s head.
Intel is currently losing in the next generation processor race to the likes of TSMC and Samsung, and Tan’s company re-organisation is part of the strategy to gain ground.
Intel’s core CPU roadmap is expected to see Panther Lake, built on the 18A node, appear in “late 2025” with a focus on AI performance and reintroducing Hyper-Threading to P-cores. In the server business, the Granite Rapids offering is still being developed.
A year ago, Intel secured an $11 billion investment from private equity firm Apollo Global Management for its chip fabrication plant in Ireland.
In exchange, Apollo gained a 49% equity stake in the joint venture related to Fab 34, located in Leixlip.
