Latest news with #TanLipBu
CNA
20-05-2025
- Business
- CNA
Intel explores sale of networking and edge unit: Sources
TAIPEI: Intel has considered divesting its network and edge businesses as the chipmaker looks to shave off parts of the company its new CEO does not see as crucial, three sources familiar with the matter said. Talks about the potential sale of the group, once called NEX in Intel's financial results, are a part of CEO Tan Lip-Bu's strategy to focus its tens of thousands of employees on areas in which it has historically thrived: PC and data centre chips. "That's something we're going to expand and build on," Tan told executives in Taipei on Monday (May 19) at a celebration of Intel's 40th year, adding that the firm had a share of about 68 per cent of the PC chip market and 55 per cent of that for data centers. Intel has considered when and how to exit its NEX group and engaged third parties who may be interested in a deal, one of the sources familiar with the matter said. But it has not yet launched a formal deal process for the NEX unit, or solicited bidders, said two of the sources. All three spoke on condition of anonymity as they were not authorised to discuss confidential matters with the media. The company interviewed investment bankers to select an adviser for the sales process in recent weeks, one of the sources said. But Intel has not yet hired a banker, another of the sources said. Intel declined to comment. Intel is exploring the idea of a sale because the businesses in its former NEX group no longer appear as relevant to the focus Tan has adopted for the company, said two of the sources. The unit which makes chips for telecom equipment will no longer help Intel's core strategy, one source said. Intel's networking business may also be sold, because companies such as Broadcom have a tight grip on crucial portions of that market, another source said. Intel has discussed the portfolio of businesses with the general aim of deciding if it would make strategic sense to partner with another company or sell a stake in it, one of the sources said. The discussions within Intel are at an early stage, and the company could decide to make other arrangements besides a sale for the NEX businesses. In the year's first quarter, Intel moved the NEX financial results into its data centre and PC groups and now does not report the segment separately. The NEX group generated revenue of US$5.8 billion in 2024, securities filings show. Intel has already moved to shed some lines of business. In April, it sold a majority stake in its Altera unit to SilverLake for US$4.46 billion to help fund the revival effort. Before the SilverLake sale, the company had been preparing to spin out Altera through a public offering under former CEO Pat Gelsinger, as it did with Mobileye in 2022. Though Tan has told investors Intel plans to focus efforts on core operations that have historically been its largest revenue generators, the company has suffered significant losses in its share in the data centre and PC areas.
RTHK
25-04-2025
- Business
- RTHK
Layoffs set for Intel as new boss looks to catch up
Layoffs set for Intel as new boss looks to catch up Tan Lip Bu says Intel must remove 'organizational complexity' and reduce the size of its workforce. File photo: AFP New Intel chief executive Tan Lip Bu has announced upcoming layoffs at the struggling US chipmaker as White House tariffs and export restrictions muddy the market. Tan did not provide details about the number of employees affected, but said he was "a big believer in the philosophy that the best leaders get the most done with the fewest people". Despite the promise of cost-cutting and an earnings report that bested market expectations, Intel's share price sank more than 5 percent after it reined in its financial outlook for the current quarter due to broader market conditions. "The economic landscape has become increasingly uncertain, driven by shifting trade policies, persistent inflation and increased regulatory risk," Intel chief financial officer David Zinsner said during an earnings call. "The very fluid trade policies in the US and beyond, as well as regulatory risks, have increased the chance of an economic slowdown with the probability of a recession growing." Intel reported a loss of US$800 million on revenue of US$12.7 billion in the first three months of this year. The chipmaker forecast revenue of between US$11.2 billion and US$12.4 billion in the current quarter. Bloomberg reported that more than 20 percent of staff could be laid off. When asked for more details about the job cuts, a spokeswoman did not offer figures, but referred to an email to staff from Tan, who said the layoffs would begin in the current quarter and continue "over the next several months." "As we refocus on engineering, we will also remove organizational complexity," Tan said in the note to staff. "There is no way around the fact that these critical changes will reduce the size of our workforce." Malaysia-born tech industry veteran Tan, who took over as Intel chief executive in March, has said it "won't be easy" to overcome challenges faced by the company. Intel is one of Silicon Valley's most iconic companies, but its fortunes have been eclipsed by Asian powerhouses TSMC and Samsung, which dominate the made-to-order semiconductor business. The company was also caught by surprise with the emergence of Nvidia as the world's preeminent AI chip provider. Intel's niche has been in chips used in traditional computing processes being eclipsed by the AI revolution. "I strongly believe we can reduce our costs while securing our future," Tan said. "Our competitors are lean, fast and agile – and that's what we must become to improve our execution." (AFP)
