Intel has said that it is shelving plans to spin off or sell a stake in its Networking and Edge Group (NEX) division. The chipmaker said that it is now best positioned to succeed as an internal unit. The decision marks a reversal of a strategy announced earlier this year. The company said it would separate the division and identify strategic investors.“After a thorough review of strategic options for NEX—including a potential standalone path—we determined the business is best positioned to succeed within Intel,” the company said in an emailed statement to Bloomberg.The company previously sought to sell non-core assets, including NEX, to give a boost to its finances after it struggled to keep pace with rivals like Taiwan Semiconductor Manufacturing Comapny (TSMC) and Samsung Electronics.“Keeping NEX in-house enables tighter integration between silicon, software and systems, strengthening customer offerings across AI, data center, and edge. As part of the move, Intel ended talks with Ericsson AB, which had discussed buying a stake in NEX,” a spokesperson was quoted as saying. Swedish telecom equipment maker Ericsson relies heavily on Intel-designed chips for several of its mobile network products and had been seeking to ensure the NEX division remained viable.
How ‘new’ financial support has drive a change at Intel
The change in selling strategy comes months after CEO Lip-Bu Tan took the helm in March. While Tan initially focused on cost-cutting measures, including job cuts and offloading non-core assets, the company’s recent influx of capital appears to have altered its trajectory.Intel has received major financial boosts this year, including a 10% equity stake taken by the US government in August, brokered by the Trump administration. It also got a $2 billion investment from SoftBank Group Corp and an additional $5 billion investment from Nvidia. Meanwhile, Intel’s stock has more than doubled this year.
