Intel, the American tech giant, has announced a series of significant measures to restructure its business and enhance its competitiveness in the global semiconductor market. The company’s CEO, Pat Gelsinger, has detailed these changes in an internal communication addressed to employees.
Establishment of an Independent Subsidiary for Intel Foundry
One of the key measures is the creation of Intel Foundry as an independent subsidiary within the company’s structure. This decision aims to provide greater independence and flexibility to the chip fabrication division, allowing Intel to assess independent sources of funding in the future and optimize the capital structure of each division.
Expansion and Adjustments in Production Capacity
Intel has announced changes to its manufacturing expansion and chip fabrication plans:
- The plant in Ireland will remain the main production center in Europe in the short and medium term.
- Construction projects for plants in Poland and Germany will be paused for approximately two years.
- Construction of a new advanced packaging plant in Malaysia will proceed, although its operation will be adjusted to market conditions.
Strategic Collaboration with Amazon Web Services
Intel has expanded its collaboration with Amazon Web Services (AWS), which includes:
- Joint investment in custom chip designs.
- A multi-billion dollar framework agreement to supply Intel products and wafers to AWS.
- Manufacturing of an AI chip for AWS using the Intel 18A node.
- Production of a customized Xeon 6 chip on Intel 3.
Product Portfolio Restructuring
The company is taking steps to strengthen and simplify its Intel product portfolio:
- Focus on maximizing the value of its x86 franchise in client, edge, and data center markets.
- Integration of Edge and Automotive divisions into the Client Computing Group (CCG).
- NEX business will focus on networks and telecommunications.
- Integrated Photonics Solutions division will be moved to the Data Center and AI Group (DCAI).
Cost Reduction and Efficiency
Intel is implementing measures to create a more competitive cost structure:
- Advancing with a workforce reduction of approximately 15,000 employees.
- Planning to reduce or abandon about two-thirds of its global real estate properties by the end of the year.
Government Financing
Intel has received direct funding of up to $3 billion from the US Government’s Secure Enclave program under the CHIPS and Science Law.
These changes are part of the most significant transformation of Intel in over four decades, as stated by Gelsinger. The company aims to position itself as a driver of operational efficiency and financial performance, ready to compete in the current and future semiconductor market.
Source: Intel