Intel misplaced out on a contract to design and manufacture the chip for Sony‘s upcoming PlayStation 6 console in 2022, dealing a big setback to its fledgling contract manufacturing enterprise, Reuters reported, citing three sources accustomed to the matter.
The contract, which might have generated roughly $30 billion in income for Intel, was awarded to rival Superior Micro Units (AMD) after a aggressive bidding course of that eradicated different contenders similar to Broadcom, in accordance with the sources.
Intel and AMD have been the ultimate two contenders for the profitable deal, which might have concerned designing the chip for the forthcoming PlayStation 6 and utilizing Taiwan Semiconductor Manufacturing Co (TSMC) because the contract producer. The enterprise would have amounted to fabricating 1000’s of silicon wafers a month, two sources advised Reuters.
The loss represents a missed alternative for Intel CEO Pat Gelsinger‘s turnaround plan, which centred on making a foundry unit. Gelsinger introduced plans for Intel’s contract manufacturing effort in 2021 and formally launched it in February 2024.
In line with Reuters, the deal fell by means of as a result of disagreements over revenue margins, regardless of months of negotiations that included conferences between the CEOs, executives, and dozens of engineers from each firms.
Sources mentioned profitable the PlayStation 6 chip contract would have offered Intel with a gradual stream of enterprise, probably occupying its foundry unit for over 5 years. The deal might have additionally helped entice different main purchasers to Intel’s superior 18A manufacturing course of.
The setback comes at a difficult time for Intel, which just lately introduced plans to chop 15% of its workforce and scale back capital spending on manufacturing unit growth. The corporate reported $7 billion in working losses for its manufacturing companies within the first quarter of this yr.
Sony has not but formally introduced the PlayStation 6. The corporate just lately unveiled the PlayStation 5 Professional and reported gross sales of 20.8 million first-generation PlayStation 5 programs in fiscal 2023.
Usually, Sony consoles promote greater than 100 million models throughout half a decade. The PlayStation 2, launched in 2000, bought roughly 150 million models over its lifetime.
Intel, Sony, and Broadcom didn’t reply to requests for remark, whereas AMD declined to remark, Reuters reported.
The contract, which might have generated roughly $30 billion in income for Intel, was awarded to rival Superior Micro Units (AMD) after a aggressive bidding course of that eradicated different contenders similar to Broadcom, in accordance with the sources.
Intel and AMD have been the ultimate two contenders for the profitable deal, which might have concerned designing the chip for the forthcoming PlayStation 6 and utilizing Taiwan Semiconductor Manufacturing Co (TSMC) because the contract producer. The enterprise would have amounted to fabricating 1000’s of silicon wafers a month, two sources advised Reuters.
The loss represents a missed alternative for Intel CEO Pat Gelsinger‘s turnaround plan, which centred on making a foundry unit. Gelsinger introduced plans for Intel’s contract manufacturing effort in 2021 and formally launched it in February 2024.
In line with Reuters, the deal fell by means of as a result of disagreements over revenue margins, regardless of months of negotiations that included conferences between the CEOs, executives, and dozens of engineers from each firms.
Sources mentioned profitable the PlayStation 6 chip contract would have offered Intel with a gradual stream of enterprise, probably occupying its foundry unit for over 5 years. The deal might have additionally helped entice different main purchasers to Intel’s superior 18A manufacturing course of.
The setback comes at a difficult time for Intel, which just lately introduced plans to chop 15% of its workforce and scale back capital spending on manufacturing unit growth. The corporate reported $7 billion in working losses for its manufacturing companies within the first quarter of this yr.
Sony has not but formally introduced the PlayStation 6. The corporate just lately unveiled the PlayStation 5 Professional and reported gross sales of 20.8 million first-generation PlayStation 5 programs in fiscal 2023.
Usually, Sony consoles promote greater than 100 million models throughout half a decade. The PlayStation 2, launched in 2000, bought roughly 150 million models over its lifetime.
Intel, Sony, and Broadcom didn’t reply to requests for remark, whereas AMD declined to remark, Reuters reported.
