Intel Announces Foundry Spin-Off, AWS Deal, and U.S. Funding; Stock Surges 8%

Sep 16, 2024, 08:16 PM

Intel is making significant strategic moves to reshape its business operations. The company announced plans to turn its foundry business into an independent subsidiary, a move that will allow it to raise external funding. This decision comes amid Intel's ongoing efforts to address its manufacturing and design challenges. Additionally, Intel has secured a multiyear, multibillion-dollar deal with Amazon Web Services (AWS) to produce custom AI chips, including an AI fabric chip on Intel 18A and a custom Xeon 6 chip on Intel 3. This expanded collaboration with AWS is part of Intel's broader strategy to enhance its chip-making capabilities and bolster its market position. Intel has also been awarded up to $3 billion from the U.S. government for national security-related chip production. The company's stock surged by 8% in after-hours trading following these announcements. CEO Pat Gelsinger also announced that Intel is pausing its plans in Germany and Poland.