Intel has announced a key customer win and changes to its foundry business as the beleaguered chipmaker looks to execute a turnaround.
Intel is taking steps to transition its chip foundry division, Intel Foundry, to an independent subsidiary, Intel CEO Patrick Gelsinger said in a blog post. Intel Foundry’s leadership isn’t changing, and the subsidiary will remain inside Intel. But Intel Foundry will gain an operating board including independent directors.
Gelsinger also said the company would pause its chip fabrication projects in Poland and Germany for two years "based on anticipated market demand," and consider pulling back on its chip packaging and testing operations in Malaysia. Intel previously pledged to spend over $36 billion to build semiconductor factories in Magdeburg, Germany, $4.6 billion on a chip plant near the Polish city of Wroclaw, and $7 billion on its Malaysia footprint.
But in a win for the foundry business, Gelsinger revealed that Intel has signed a deal with AWS to co-develop an AI chip using Intel's 18A chip fabrication process. Intel has also agreed to produce a custom Xeon 6 processor for AWS, building on an existing partnership between the two firms.
"We have tripled our deal pipeline since the beginning of the year," Gelsinger said of Intel Foundry's business, describing the AWS deal as a "multi-year, multi-billion-dollar framework" that could potentially involve additional chip designs. He added that it "demonstrates the continued progress we are making to build a world-class foundry business."