On Wednesday, Intel announced the division of its graphics chips unit into two separate entities, a strategic move aimed at enhancing its competitiveness against Nvidia and Advanced Micro Devices. The consumer graphics unit will merge with Intel’s client computing group, responsible for producing chips for personal computers. Simultaneously, teams specializing in accelerated computing will integrate into the data center and artificial intelligence (AI) division of the company. This restructuring reflects Intel’s heightened focus on accelerated computing, a burgeoning sector currently dominated by Nvidia amidst the surge in AI applications.
The realignment, according to Wedbush Securities analyst Matthew Bryson, is seen as a move that may not significantly alter the company’s operations but rather aligns products more closely with their respective sales organizations, eliminating the need for a separate segment.
Raja Koduri, the head of the graphic chips unit, will revert to his role as chief architect, overseeing Intel’s long-term technology and chip design strategy. Koduri, known for leading graphics technology initiatives at Apple and AMD, joined Intel in 2017.
In recent news, it was reported that Intel has stepped back from its initial goal of establishing a chip factory in Magdeburg, Germany, by the first half of 2023. The decision, as reported by regional newspaper Volksstimme, was influenced by Intel seeking additional public subsidies. The Magdeburg facility is a crucial part of German and European Union plans to bolster local manufacturing in response to the vulnerabilities exposed by the COVID-19 pandemic and Russia’s invasion of Ukraine. However, surges in energy and raw material prices have led to an increase in estimated costs from the initially budgeted EUR 17 billion to approximately EUR 20 billion, impacting Intel’s original calculations.