Intel Has Sold Their NAND Storage Unit to SK Hynix

[Random_Person1234]

Summary

Intel is in talks to sell part of, or the entirety, of their NAND Storage Unit to SK Hynix. Intel is negotiating to sell it's NAND production unit for around $10 billion. The details over what exactly Intel would sell to SK Hynix are still unclear. 

UPDATE: The sale has officially been confirmed for $9 billion, and involves Intel’s entire NAND storage unit. The final closing of the sale is expected in 2025, with government approval expected in late 2021.

https://news.skhynix.com/sk-hynix-to-acquire-intel-nand-memory-business/

Quotes

Quote

Intel has stated in past earnings calls that it was looking at options to reduce its exposure to the ups and downs of the storage business, so it comes as no surprise that the Wall Street Journal today reports that Intel is negotiating to sell its NAND production unit to SK hynix for roughly $10 billion. 

Intel has long been rumored to be in talks with its rival NAND chipmaker SK hynix, and today's report seemingly confirms that Intel will divest itself of at least part of its storage business to the South Korean firm. Analysts expect the deal could be announced as soon as today. 

 

My thoughts

As the article states, the storage industry doesn't really fit well for Intel due to its low margins. Hopefully now they can focus more on their CPUs if they sell their NAND division.

 

Sources

https://www.tomshardware.com/news/intel-in-talks-to-sell-nand-storage-unit-to-sk-hynix-for-dollar10-billion-wsj

https://www.wsj.com/articles/intel-nears-deal-to-sell-nand-memory-unit-to-sk-hynix-11603129781?source=news_body_link

[porina]

Makes sense if the NAND business isn't helping their core business. It'll be one fewer distraction for management to deal with, and in an area that doesn't seem critical to their product mixes. This probably wont make a big difference overall assuming Intel keep Optane, since that isn't flash.

[Helpful Tech Witch]

Makes sense. Not enough money for the CPU division, and low profit on NAND division, sell band for 10bil, and have 10bil for cpus.

 

[porina]

1 minute ago, HelpfulTechWizard said:

Makes sense. Not enough money for the CPU division, and low profit on NAND division, sell band for 10bil, and have 10bil for cpus.

I don't think they're short on cash to spend on CPUs. In a quick search, as of 2019 they had over 13B cash on hand.

[Helpful Tech Witch]

1 minute ago, porina said:

I don't think they're short on cash to spend on CPUs. In a quick search, as of 2019 they had over 13B cash on hand.

true, though thy need all the R&D cash they can get. Also, there is some new stuff about intel dgpus, so I guess its possible they want more for that.

[ravenshrike]

47 minutes ago, porina said:

I don't think they're short on cash to spend on CPUs. In a quick search, as of 2019 they had over 13B cash on hand.

Figure that events have left them with closer to 10 bill and this doubles cash on hand. Which they may very well need to compete with Zen 4 and 5 depending on how well the big.little form factor of Alder Lake actually does in the real world.

[soldier_ph]

Holy Shit they are falling apart, first the 5G Division and now the NAND Unit ? What's gonna happen with Optane ? I'm gonna guess once SK Hynix has their hands on Optane they will implement the technology in many more Storage Products across the Board and make it more accessible to the general Consumer. Maybe also going as far as implementing support for it on the AMD Platform.

[Random_Person1234]

2 minutes ago, soldier_ph said:

Holy Shit they are falling apart, first the 5G Division and now the NAND Unit ? What's gonna happen with Optane ? I'm gonna guess once SK Hynix has their hands on Optane they will implement the technology in many more Storage Products across the Board and make it more accessible to the general Consumer. Maybe also going as far as implementing support for it on the AMD Platform.

Optane isn't NAND, so I doubt Intel is selling it to SK Hynix, or selling it at all.

[Bombastinator]

This thing caused me to look at the skhynix wiki.

 

it was mostly badly out of date.  They were talking about Apple a9 chips.  There was one tidbit tacked on the end though:

 

”In May 2020, SK Hynix became the first Korean semiconductor company to share its sensitive technical data with a research institute (Korea Advanced Institute of Science and Technology) in real time through the cloud to further enhance its R&D process. ^[8]”

 

 

[Lingerr]

https://ca.reuters.com/article/technologyNews/idCAKBN2742IY-OCATC

"Intel would keep its Optane business, its advanced memory technology."

[realpetertdm]

UPDATE: Intel has sold their NAND division to SK Hynix.

 

Official press release from SK Hynix (Korean)

https://news.skhynix.co.kr/2305?category=1067707

 

(English)

https://news.skhynix.com/sk-hynix-to-acquire-intel-nand-memory-business/

 

 

[Bombastinator]

Well let’s hope that doesn’t turn horrible.  

[CarlBar]

6 hours ago, ravenshrike said:

Figure that events have left them with closer to 10 bill and this doubles cash on hand. Which they may very well need to compete with Zen 4 and 5 depending on how well the big.little form factor of Alder Lake actually does in the real world.

 

Bear in mind that AMD can't produce enough ZEN CPU's to supply everyone. TSMC doesn't have enough production capacity even if AMD had access to all of it for that. So Intel isn't going to have cash-flow issues anytime soon as they have guaranteed income from all the people who will have no choice but to buy Intel CPU's.

[kirashi]

6 hours ago, soldier_ph said:

I'm gonna guess once SK Hynix has their hands on Optane they will implement the technology in many more Storage Products across the Board and make it more accessible to the general Consumer.

 

7 hours ago, Random_Person1234 said:

Intel is in talks to sell part of, or the entirety, of their NAND Storage Unit to SK Hynix

Quite an interesting sale indeed... Micron's own QuantX storage drives are based on the same 3D XPoint that Intel uses for Optane (since Micron and Intel co-developed 3D XPoint technology), so I wonder if/when they might be selling these QuantX drives to compete with Optane outside of the enterprise data center space.

[Blade of Grass]

Makes sense. NAND isn't Intel's forte and Samsung's dominance in the market (i.e. control over pricing power) left little room for Intel to try and build out their business. Plus, this will free up a lot of money for them to invest in their CPU and fab divisions.  

[rawrdaysgoby]

DANG Intel before had enough spare time to go on a Nand journey to diversify now... They are forced to just throw away that division of theirs. Not looking good for intel anymore if they can't keep up with their pet projects 

[SpaceGhostC2C]

Yeees even fewer players in the flash manufacturing business! This has to be great news for all of us, isn't it? 

[xentropa]

Honestly I don't even know why they got in the NAND business to begin with.  My guess was that they wanted to flip Micron Technologies a middle finger for divorcing them.  Unfortunately I don't think intel has good enough expertise on the memory cell design which was Micron's expertise.  Intel continued to make the more problematic Floating gate type NAND while everyone else including Micron moved onto charge trap type.

[porina]

Quote

Speaking of the future, Intel has also stated that they will be investing the expected proceeds from the sale into some of their other non-core, forward-looking businesses. Intel’s 5G, AI, and edge efforts are all slated to benefit from the sale, and all are markets that Intel is priming for potentially extreme growth over the coming years.

https://www.anandtech.com/show/16182/sk-hynix-to-buy-intels-nand-memory-business-for-9-billion

 

I don't know where people get the idea that Intel has financial problems, and needs the cash for the CPU business is coming from. The CPU side is their core business and isn't under-funded, distinct from unable to successfully execute.

 

The world is not unchanging. What might have seemed a good idea does not remain so forever. If it is time to make a change, not doing it could be worse.

[Helpful Tech Witch]

20 hours ago, Blade of Grass said:

control over pricing powe

wdym>? they keep seling their drives for higher than anyone else.

[Vishera]

That's good,No more cheaply made consumer QLC SSDs from Intel.

[GoldenLag]

3 hours ago, Vishera said:

That's good,No more cheaply made consumer QLC SSDs from Intel.

thats bad, the cheap QLC SSDs are allright, and less players in the Nand market. 

[Blade of Grass]

4 hours ago, HelpfulTechWizard said:

wdym>? they keep seling their drives for higher than anyone else.

Exactly, and yet they have the largest share of the sector (31% vs. next highest competitor at 16%). 

[williamcll]

I wonder will SK release their own optane drives.

[LukeSavenije]

17 hours ago, williamcll said:

I wonder will SK release their own optane drives.

they won't, as Optane isn't part of the deal here. it's just the NAND division