Intel product-business and its foundry to work at arm-length
Date: 27/06/2023
Intel to optimally utilize billions of worth of its internal semiconductor manufacturing resources, by making its product-division more like a foundry customer to its fab-division. Its competitor AMD gone fables long time back and it's foundry competitors don't design chips except Samsung. Intel started thinking to run its highly advanced chip-making equipments for other companies around 8-9 years back. But now from past two years Intel is putting more effort in developing separate Intel foundry business. In a recent release, Intel said that its transiting to a new internal foundry model which will be a key enabler to achieve cost savings goal of more than $8-10 billion exiting 2025. Intel may finally rename its foundry business, where Intel chip design business can be its big customer. Much like following, how AMD has done by creating GlobalFoundries.
Intel said as per the new operating model, Intel’s internal product groups move to a foundry-style relationship with the company’s manufacturing group. A fundamental shift by Intel where it said, it's embarking on the most significant business transformation in its 55-year history, where you want to regain deep node chipmaking leadership and also build world-class foundry business.
As part of its IDM 2.0 stretegy, Intel set out to regain process technology leadership, and utilize third-party foundry capacity while building a world-class foundry business with a significant expansion of Intel’s manufacturing capacity.
Intel wanted its product business units work with foundry business like how fabless semiconductor companies engage with external foundries. With this new model Intel plans to reduce costs by $3 billion in 2023, and $8 billion to $10 billion in cost savings exiting 2025.
