Chipmaker Intel has announced plans to spin out its programmable chip unit into a separate business, with the intention of holding an initial public offering (IPO) for the stock within the next two to three years. The move comes as Intel seeks to focus on its core business and unlock the potential of this specific unit. The programmable chips, which were acquired by Intel when it bought Altera for $16.7 billion in 2015, occupy a crucial role in the technology landscape, sitting between general-purpose chips and chips designed for specific tasks such as encrypting data or powering 5G wireless telecommunications equipment.
The decision to spin out the programmable chip unit represents a strategic move by Intel to become leaner and more agile in the face of intense competition in the semiconductor industry. The IPO will allow the company to unlock the value of this unit and provide an avenue for further growth. Intel plans to operate the unit as a standalone business from January 2023, with Sandra Rivera, a long-time Intel veteran, overseeing its operations. Rivera already oversees the data center and artificial intelligence chip business at Intel, which competes with Nvidia and Advanced Micro Devices.
Intel’s decision to spin out this unit and hold an IPO reflects the company’s efforts to streamline its operations and focus on its core strengths in the face of a rapidly evolving marketplace. By separating the programmable chip unit into its own business, Intel can provide it with the flexibility and resources it needs to thrive. This move will not only allow Intel to attract new investors but also enable the unit to better serve its customers and explore new opportunities in the growing market.
According to Intel, programmable chips have a wide range of applications and are essential in various industries. Speaking about the decision, Sandra Rivera stated, “Programmable chips play a vital role in enabling the digital transformation across industries and are powering some of the world’s most important technologies. We see a significant opportunity to unlock more value and growth from this business through an IPO.”
By holding an IPO, the programmable chip unit will have access to additional capital to invest in research and development, expand its manufacturing capabilities, and further innovate in its product offerings. This will allow the unit to remain competitive in the fast-paced and rapidly evolving semiconductor industry.
The decision to spin out the programmable chip unit and hold an IPO is undoubtedly a significant move for Intel. While the company remains a dominant player in the semiconductor market, its decision to separate this unit demonstrates a keen focus on growth and the ability to adapt to the changing needs of the industry. As technological advancements continue to revolutionize different sectors, Intel’s move will position the programmable chip unit for success in this dynamic landscape.
Intel’s announcement is indicative of the company’s commitment to innovation and its dedication to providing customers with cutting-edge products. With the programmable chip unit set to become a standalone business, Intel is better positioned to meet customer demands and invest in future advancements. It remains to be seen how successful the IPO will be, but the move itself is a testament to Intel’s strength and vision in navigating the competitive semiconductor industry.
Use the share button below if you liked it.