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Intel’s interim co-CEOs have admitted that selling off Intel’s manufacturing business to improve its financial status isn’t off the table, according to multiple reports.
Interim co-CEO David Zinsner, who is also Intel’s Chief Financial Officer, said at the Barclays tech conference in San Francisco that Intel’s manufacturing business finances are already being separated from the rest of the company. Right now, it’s unclear if the $7.9 billion in funding from the US federal government will keep its chip foundry business tied to the company.
Zinsner suggested some kind of separation is “going to happen,” but whether Intel fully severs its manufacturing division by selling it off or ditching it entirely is “an open question for another day.” Intel’s other interim co-CEO, Michelle Johnston Holthaus, shared a similar stance, stating that “someone will decide” whether Intel splits off its chip-making division.
This decision maker will likely be Intel’s next official CEO, who has not yet been appointed at time of writing. Intel’s stock rose about 2.3% after these comments were made, according to Reuters, but Intel stock is still down 53% in the past year.
Intel’s now ex-CEO Pat Gelsinger stepped down from his position on Dec. 2 after nearly four years in the role. A board member said in a statement at the time that Intel’s board has “much more work to do at the company” and is “committed to restoring investor confidence.”
About a week ago, Zinsner said that Intel’s next CEO will have chip manufacturing experience. The US firm is reportedly considering a former Intel board member for the CEO role, as well as Marvell Technology CEO Matt Murphy.
In July, Intel faced problems with its 13th- and 14th-generation desktop chips. The chips could crash due to a bug, resulting in permanent damage. Intel extended the warranties on these chips in response.
Intel, unlike rivals AMD and Nvidia, designs and makes most of its own chips. Taiwan Semiconductor Manufacturing Corp (TSMC) makes chips for Nvidia, Apple, and AMD. The Taiwanese firm is also starting up US factories in Arizona, with one to launch in 2025 and two more to begin production by 2030. TSMC founder Morris Chang said on Monday that Intel should have focused on AI (like Nvidia has) instead of on its chip manufacturing business, adding that he didn’t know why Gelsinger resigned.
Even if Intel decides to keep its manufacturing business, it will have to compete with TSMC as well as Samsung and Micron, which are also making investments in stateside chip-building and receiving billions in funding from the federal government.
