Intel to spin off Programmable Solutions Group, eyes IPO

Intel Corp (NASDAQ:). is set to spin off its Programmable Solutions Group (PSG) into a standalone entity, a move designed to fortify its presence in the field-programmable gate array industry. The company’s CEO, Pat Gelsinger, views this as an opportunity for the tech giant to refocus on its core operations.

The decision, announced on Tuesday, is part of Intel’s broader turnaround strategy as it faces stiff competition from rivals such as Nvidia (NASDAQ:) in the realm of circuit design and manufacturing. By allowing PSG to operate independently, Intel aims to enhance growth and shareholder value. Notably, Intel has a market capitalization of 149.47 billion USD as per InvestingPro data.

The spun-off entity will be co-led by Sandra Rivera and Shannon Poulin. Rivera will serve as CEO, while Poulin will take on the role of Chief Operating Officer. The executives are currently exploring various funding options, including an initial public offering (IPO) and potential investments from private investors.

According to the company’s announcement, PSG’s operations as a standalone entity are expected to commence on January 1st. Moving forward, PSG’s performance will be reported separately, underlining its newfound independence within the organization.

This strategic shift underlines Intel’s commitment to focusing on its core operations while providing PSG with the autonomy to navigate its own path in the rapidly evolving technology landscape. Despite the declining trend in earnings per share, Intel has maintained its dividend payments for 32 consecutive years, according to InvestingPro Tips. However, the company’s revenue growth has been negative with a drop of 26.36% in the last twelve months, as shown in the InvestingPro data.

Intel’s prominence in the Semiconductors & Semiconductor Equipment industry is undeniable. Yet, the company is facing challenges with analysts anticipating a sales decline in the current year. The company’s net income is also expected to drop this year. However, analysts predict the company will be profitable this year, as per InvestingPro Tips.

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