Intel to establish Intel Foundry as independent subsidiary

Intel CEO Pat Gelsinger sent a note to staff saying that, to build on the company’s progress, it intends to establish Intel Foundry as an independent subsidiary inside of Intel. This governance structure will complete the process we initiated earlier this year when the company separated the P&L and financial reporting for Intel Foundry and Intel Products. “A subsidiary structure will unlock important benefits,” Gelsinger said. “It provides our external foundry customers and suppliers with clearer separation and independence from the rest of Intel. Importantly, it also gives us future flexibility to evaluate independent sources of funding and optimize the capital structure of each business to maximize growth and shareholder value creation. There is no change to our Intel Foundry leadership team, which continues to report to me. We will also establish an operating board that includes independent directors to govern the subsidiary. This supports our continued focus on driving greater transparency, optimization and accountability across the business.” The CEO added that the company recently increased capacity in Europe through its fab in Ireland, which will remain its lead European hub for the foreseeable future. “We will pause our projects in Poland and Germany by approximately two years based on anticipated market demand,” he added. “Malaysia remains an active design and manufacturing hub through our existing operations. We plan to complete the construction of our new advanced packaging factory in Malaysia but will align the startup with market conditions and increased utilization of our existing capacity. There are no changes to our other manufacturing locations. We remain committed to our U.S. manufacturing investments and are moving forward with our projects in Arizona, Oregon, New Mexico and Ohio. We remain well-positioned to scale up production around the world based on market demand as we grow our foundry business.”