Intel’s manufacturing division could become a separate entity, but its future remains uncertain.
Following the recent departure of Pat Gelsinger as CEO of Intel, the company finds itself at a crossroads regarding the future of its manufacturing division, Intel Foundry. While Michelle Johnston Holthaus, interim co-CEO, is skeptical about the idea of a complete spin-off, David Zinsner, the other interim co-CEO, considers it an open possibility.
At the 22nd Annual Barclays Global Technology Conference, Holthaus stated that although the product and foundry divisions operate independently, a total separation would not make strategic sense. “Great products with a cutting-edge manufacturing process, which we have prioritized access to, is a differentiating factor,” she said.
For his part, Zinsner, while initially favoring Gelsinger’s strategy to make Intel a leader in both CPUs and chip manufacturing, acknowledged at the Barclays conference that the spin-off of Intel Foundry is an “open question.”
Zinsner explained that Intel Foundry will become a subsidiary with its own operating board and an independent Enterprise Resource Planning (ERP) system. “We are already on that path, and it’s going to happen,” he assured. However, he did not rule out the possibility of a total separation in the future.
This potential independence could lead to an IPO for Intel Foundry, although the profitability of such a move is questionable, given that Intel’s manufacturing technology is not the most advanced on the market.
Currently, Intel is focusing its efforts on the success of its 18A (1.8 nm) process technology, aiming to reduce defect density and improve performance. The company has received several requests for proposals from interested customers, but it is still too early to confirm orders. Intel is expected to share updates on its 18A progress in its earnings report at the end of January.
Ultimately, the final decision regarding the future of Intel Foundry will rest with the board of directors or the future CEO of the company.
via: Tom’s Hardware