Intel announced that the company will divest its programmable solutions division (PSG), operating as an independent business.
The business unit, which is responsible for developing Intel’s Agilex, Stratix and other FPGA products, will become a separate entity under Intel Corporation starting in the first quarter of 2024, with the long-term goal of selling a portion of the business in an IPO two to three years from now.
Intel PSG transforms into a standalone business unit in early 2024, with Intel executive Sandra Rivera serving as the new CEO of PSG, Rivera is currently general manager of Intel’s Data Center and Artificial Intelligence Group (DCAI). In the interim, Rivera will also continue in her role at DCAI until Intel finds a replacement.
The spin-off of PSG is Intel’s latest move to reorganize the company’s multifaceted operations to focus on its core competencies of silicon lithography and chip design. Since the appointment of current CEO Pat Gelsinger two years ago, Intel has sold or divested several business units, including its SSD business, NUC mini PC business, Mobileye ADAS division, etc., while at the same time making significant new investments in Intel’s Foundry Services (IFS) fab division.
For the standalone PSG business unit, Intel is looking at a track very similar to Mobileye, where Intel will retain a majority stake while still freeing up the business unit to operate more independently. This strategy has worked well for Mobileye, which has continued to grow along with its successful IPO last year, and Intel hopes they can do it again with a separate PSG business.
Intel has admitted to mismanaging PSG, and despite a series of record quarterly financial results, Intel believes that PSG is under-served in the true high-growth, high-profitability markets for FPGAs, such as industrial, automotive, defense, and aerospace. Since its acquisition by Intel in 2015, and especially over the past few years as a formal part of DCAI, Intel’s PSG has been focused on data center solutions to the detriment of other business units.
“This is a very exciting day for me and the PSG team. Re-establishing PSG as a standalone business will allow us to unlock our full potential as we seek leadership in this demanding and essential part of the semiconductor industry,” said Rivera. Our strategic relationship with Intel will continue to be an advantage as it provides us with maximum flexibility in how we address fast-growing markets such as automotive, data centers and communications.
