In a strategic move to streamline operations and unlock value, global chipmaker Intel Corporation has announced plans to operate its Programmable Solutions Group (PSG) as a standalone business from January. The company intends to eventually hold a public offering (IPO) for the PSG business within the next two to three years.
Sandra Rivera, a seasoned Intel veteran, will lead the new unit, which will continue to leverage Intel’s factories for chip manufacturing. Shannon Poulin has been appointed as the Chief Operating Officer (COO) of the Programmable Solutions Group. Intel did not reveal the target revenue of the PSG group.
During a recent conference call with investors, Sandra Rivera emphasized that PSG has increasingly been utilizing Intel’s factories, showcasing a strategic shift away from the Taiwanese facilities where their chips were traditionally manufactured. Programmable chips are crucial components in defense applications like fighter jets, and Sandra Rivera highlighted the growing customer interest in securing a resilient supply chain within North America.
“This strategic move aims to give us a unique advantage by leveraging Intel’s resources and catering to the growing demand for a secure and reliable supply chain,” Sandra Rivera explained.
The decision to spin off the PSG business follows Intel’s recent efforts to streamline its operations, including the sale of its memory chip unit to SK Hynix and taking part of its Mobileye self-driving car chip unit public. These moves are in line with Chief Executive Pat Gelsinger’s strategy to rejuvenate the company by revitalizing its manufacturing arm, which had faced competition from rivals like Taiwan Semiconductor Manufacturing Co (TSMC).
The FPGA (Field-Programmable Gate Array) market is projected to witness substantial growth, with estimates indicating a compound annual growth rate (CAGR) exceeding 9 percent, surging from $8 billion in 2023 to $11.5 billion by 2027. Intel’s PSG has been on a growth trajectory, achieving record revenues for a third consecutive quarter, showcasing consistent progress in product development and launches.
In the second quarter of 2023, Intel reported that PSG had launched 11 out of the 15 new products slated for release in the calendar year. Notable among these was the Intel Agilex 7 with the R-Tile chiplet, a groundbreaking FPGA featuring PCIe 5.0 and CXL capabilities and the only FPGA with hard intellectual property (IP) supporting these interfaces. This momentum underscores Intel’s commitment to innovation and market leadership in the programmable chip domain.