In a significant pivot that could reshape Intel’s future, the tech giant is quietly weighing whether to sell off its network and edge computing business units. The move reflects a broader strategy by newly appointed CEO Lip-Bu Tan to bring the company back to its core strengths—making chips that power personal computers and data centers.
According to sources close to the matter, Intel has already held early internal talks about shedding its Network and Edge (NEX) group, a division that once formed a major piece of its diversified tech ecosystem. While a formal sale process hasn’t been launched, the company has begun interviewing investment banks to potentially manage the sale, signaling that serious consideration is underway.
Back to the Basics
Tan’s arrival has brought a renewed sense of purpose to Intel, which has been struggling in recent years to maintain its dominance in the semiconductor space. At a recent gathering in Taipei celebrating Intel’s 40 years in the region, Tan made his intentions clear: the company would focus squarely on areas where it still holds a competitive edge—PC and data center chips.
“We’re going to expand and build on that,” Tan told Intel executives, pointing to Intel’s still-formidable 68% market share in PC chips and 55% in data center processors.
His message was unambiguous: Intel will no longer spread itself thin chasing growth in markets that don’t align with its core competencies.
What’s Behind the Potential Sale
The NEX group, once promoted as a key driver of Intel’s future, now appears misaligned with the company’s redefined priorities. The unit includes chips used in networking gear and telecom infrastructure—technologies that are essential, but heavily dominated by other players such as Broadcom. According to insiders, Intel no longer sees these offerings as strategic to its long-term vision.
One source noted that the telecom chip segment no longer fits Intel’s roadmap. Another highlighted the competitive pressures in the networking space, where Intel has struggled to gain meaningful ground.
This doesn’t mean Intel is committed to a full sale just yet. Alternatives are on the table, including strategic partnerships or partial divestitures. However, what’s clear is that the company is actively re-evaluating its portfolio—and that NEX could be the next to go.
Shifting Financial Priorities
Earlier this year, Intel began integrating NEX’s financials into its main business groups—specifically PC and data centers—effectively removing it as a standalone segment. This accounting change hinted at a shift in how Intel values the business internally.
Though no longer reported separately, NEX still contributed significantly to Intel’s revenue—$5.8 billion in 2024, according to recent filings. But given the company’s renewed focus, that figure may no longer justify continued investment in the unit.
Part of a Larger Restructuring
The potential sale of NEX follows another major move by Intel: in April, the company sold a majority stake in its Altera division to private equity firm Silver Lake for $4.46 billion. Altera, known for its programmable chips, was originally slated for a spin-off via public listing under former CEO Pat Gelsinger—a plan that echoed Intel’s successful IPO of Mobileye in 2022.
These sales are not just about offloading businesses—they are about generating capital and narrowing Intel’s focus. For Tan, the goal is clear: get back to building the high-performance chips that are Intel’s bread and butter, while cutting ties with segments that no longer contribute to that mission.
Even with these changes, Intel has a fight ahead. Despite its dominance in PCs and data centers, the company has lost ground to rivals like AMD and Nvidia in recent years. Innovations in AI chips, server hardware, and energy-efficient processors have disrupted traditional market dynamics—and Intel has struggled to keep pace.
By concentrating resources on fewer, more strategic areas, Tan is hoping to turn the tide. Still, it’s an uphill battle. Retrenching to core products may stabilize Intel, but regaining market leadership will require innovation, speed, and flawless execution.
