Last week, rumors have been circulating that Intel has been working with investment bankers on options to navigate the company through potholes. Latest update: options may include selling off its FPGA unit Altera and putting a halt to its USD 32 billion investment project in Germany, according to the reports by Reuters and Wccftech.

Citing sources familiar with the matter, the reports suggests that Intel CEO Pat Gelsinger and senior executives are expected to present a plan to the board later this month to revitalize the company.

Their proposal, according to the reports, includes divesting non-essential businesses and cutting down capital expenditures, such as selling off Altera and freezing the construction of the fab project in Magdeburg, Germany.

As Intel would be now unable to allocate funds from its once substantial profits to support Altera, a major producer of field-programmable gate arrays (FPGA) it acquired in 2015 for USD 16.7 billion, the sale of the company has reportedly been brought to the table. In 2023, Intel is said to be planning to spin Altera out through an IPO in three years and sell a portion of its stake through the process, but no date has been set.

Reuters indicates that Altera could also be sold entirely to another chip company interested in expanding its business portfolio, and Intel has quietly started exploring the possibility of such a sale.

On the other hand, due to delays of subsidy approvals. Intel has already been said to postpone its construction of Fab 29.1 and 29.2 in Magdeburg, Germany, as the new timeline now pushes the start of construction to May 2025. The proposal to put a halt to the project would also align with the company’s plan to reduce its capital spending by 17 percent to USD 21.5 billion in 2025, Wccftech notes.

Sources familiar with the matter said that Intel’s plan does not currently include splitting up the company or selling its foundry business to buyers like TSMC, Reuters notes.

An Intel spokesperson declined to comment Sunday, Reuters notes.

Intel is currently facing significant challenges. On August 1, the company announced financial results that fell short of Wall Street expectations and revealed plans to cut over 15% of its workforce.

Shortly after, former Intel board member Lip-Bu Tan has stepped down after just two years. Tan served as the CEO and executive chairman of electronic design automation (EDA) software company Cadence Design Systems Inc.

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• [News] Lip-Bu Tan Resigns from Intel Board Amid Reported Disagreements
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(Photo credit: Intel)

The Wall Street Journal reported that OpenAI is in talks for a new round of funding, with tech giants Apple and NVIDIA both interested in investing in the AI research company OpenAI.

It’s reported that this investment will be part of OpenAI’s new round of financing, which will bring its estimated value to exceed USD 100 billion.

Sources indicated that OpenAI plans to raise billions of dollars, and venture capital firm Thrive Capital will lead this round of funding with a USD 1 billion investment. Microsoft, OpenAI’s largest shareholder, will also be a part of this round.

Reportedly, sources have revealed that Apple is currently in talks with OpenAI for the potential investment, while NVIDIA has already discussed joining the latest round of funding, who reportedly considered investing USD 100 million.

Although it is not yet clear how much Apple and Microsoft plan to invest, the point is that the three most valuable tech giants in the world would all become shareholders of OpenAI if these negotiations end in success.

In a memo on Wednesday, OpenAI’s CFO Sarah Friar stated that the company is seeking new financing but did not disclose specific details. Friar mentioned that OpenAI would leverage this funding to strengthen computing power and cover other operational expenses.

With the rise of the AI industry, Microsoft, Apple, and NVIDIA have also accelerated their pace in developing AI technologies.

Microsoft has invested USD 13 billion in OpenAI since 2019, holding a stake of 49% in this company. Apple, at its Worldwide Developers Conference (WWDC) in June this year, launched the Apple Intelligence system and announced a partnership with OpenAI.

As for NVIDIA, it has long been closely collaborating with OpenAI and has been highly active in making investment in this field. Its investment arm, NVentures, has invested in several AI companies since 2023.

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(Photo credit: OpenAI)

As per Chongqing News Broadcast, the San’an-ST project, with a total investment of approximately CNY 30 billion, is close to completion. The substrate factory is expected to start production this month, two months ahead of schedule.

The project, jointly developed by Chongqing San’an and ST, includes a chip factory and a substrate factory, focusing on the production of SiC power chips and substrates. The substrate factory, fully funded by San’an Semiconductor, is set to produce 480,000 8-inch SiC substrates annually.

The chip plant, a joint venture between San’an Semiconductor and ST, aims for an annual production capacity of 480,000 automotive-grade SiC MOSFET power chips.

San’an, through its wholly-owned subsidiary Hunan San’an, established Chongqing San’an for the substrate factory. The total investment for this factory is approximately CNY 7 billion, focusing on the growth and manufacturing of SiC substrates, with an annual production capacity of 480,000 8-inch SiC substrates.

San’an STMicroelectronics, a joint venture between Hunan San’an (51%) and ST (China) Investment (49%), was established in August 2023 with a registered capital of USD 612 million.

This chip factory has a total investment of USD 3.2 billion and aims for an annual revenue of CNY 13.9 billion, with an annual production capacity of 480,000 8-inch automotive-grade SiC MOSFETs.

San’an has disclosed that the project is currently in the critical stage of equipment installation and commissioning, and the substrate factory is expected to be ready for operation by the end of August, while the chip factory is projected to be fully operational by the end of November.

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• [News] ST to Build a New 8-Inch SiC Facility in Italy with EUR 5 Billion
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(Photo credit: STMicroelectronics)

In a report by Bloomberg on August 29 citing sources, it’s rumored that Intel Corp. is working with investment bankers to navigate what is described as the most challenging period in its 56-year history.

Reportedly, Intel is said to be exploring various options, including spinning off its product design and foundry businesses, and canceling certain construction plans. Notably, Morgan Stanley and Goldman Sachs have been advising Intel, with merger being one of the options on the table.

Multiple options are expected to be presented at the board meeting in September. According to sources cited by Bloomberg, Intel is unlikely to spin off its foundry business unless absolutely necessary. The company is rumored to favor more moderate approaches, such as delaying certain expansion plans.

Per another report from CNBC, during the Deutsche Bank’s Technology Conference on August 29, Intel CEO Pat Gelsinger acknowledged that the past few weeks have been challenging. He then emphasized that the company is prepared to face the market’s criticism and tackle the challenges ahead.

Gelsinger further mentioned that the surge in AI has led to weaker performance in Intel’s server business, a challenge the company is still working to address. However, he remains optimistic about the future, noting that the finish line is already in sight.

He also mentioned that Intel will soon launch “Lunar Lake,” which he described as the most compelling PC product the company has ever developed.

Intel is currently facing significant challenges. On August 1, the company announced financial results that fell short of Wall Street expectations and revealed plans to cut over 15% of its workforce.

Gelsinger noted that the layoffs would impact approximately 15,000 employees. He acknowledged that Intel’s revenue growth has been below expectations and that the company has not yet benefited from trends like AI. Gelsinger highlighted issues with high costs and low profit margins as well, stating that he never anticipated an easy path ahead.

A report from Reuters also revealed that former Intel board member Lip-Bu Tan has stepped down after just two years. Tan, who was previously the CEO and executive chairman of electronic design automation (EDA) software company Cadence Design Systems Inc..

Read more

• [News] Lip-Bu Tan Resigns from Intel Board Amid Reported Disagreements
• [News] Intel’s Earnings Fall Short, Cutting Over 15% of Workforce

(Photo credit: Intel)

On August 27, AI server giant Supermicro was accused of accounting violations, inadequate disclosure of related party transactions, and evading sanctions by selling products to Russia by short-seller Hindenburg Research.

In addition, Supermicro announced on August 28 that it would delay the release of its annual report, potentially facing order withdrawals. Industry sources also believe this news presents a chance for Supermicro’s competitor Dell to gain market share.

Besides Dell, a report from Commercial Times also points out that Hewlett Packard Enterprise (HPE) could benefit from the shift in orders, potentially boosting shipments for its Taiwanese supply chain partners such as Wistron, Inventec, Quanta, and Foxconn.

The report from Commercial Times also cite sources, suggesting that this shift could provide Gigabyte, which is actively promoting its liquid-cooled products for NVIDIA’s H200 series, with  opportunities in the second half of the year.

Wistron, as a key supplier of motherboard and GPU accelerator cards for NVIDIA’s Hopper and Blackwell GPU, is not only a major supplier for Supermicro’s server motherboards but also for Dell. Its clients include HPE and Lenovo as well, which makes the company one of the primary beneficiaries.

Similarly, Inventec, one of the server motherboard suppliers, is also expected to benefit if the shift in orders boosts Dell, HPE, and Lenovo.

Moreover, one of Supermicro’s largest clients, CoreWeave, is transitioning to become a cloud computing service provider specializing in GPU-accelerated computing.

This shift has increased demand for GPU-accelerated computing and liquid cooling solutions. Reportedly, it’s believed that Gigabyte, which holds orders from CoreWeave, could be one of the biggest beneficiaries of the upcoming order shift.

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• [News] Supermicro Faces Order Withdrawal Crisis, Potentially Benefiting Dell
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(Photo credit: Supermicro)