Intel Announces Separation of Programmable Solutions Group (PSG) into Standalone Business

Intel Corporation has revealed its plans to establish its Programmable Solutions Group (PSG) as a separate business entity. This move aims to provide PSG with the independence and flexibility necessary to accelerate its growth and effectively compete in the FPGA industry. The FPGA market serves various sectors, including data centers, communications, industrial, automotive, aerospace, and defense.

Sandra Rivera, executive vice president at Intel, will assume the role of CEO for PSG, while Shannon Poulin has been appointed as the chief operating officer.

The standalone operations for PSG are expected to commence on January 1, 2024, with ongoing support from Intel. Intel plans to report PSG as a separate business unit in its first-quarter 2024 financials. Additionally, Intel intends to conduct an IPO for PSG within the next two to three years and may explore opportunities with private investors to accelerate the business's growth, while still retaining a majority stake.

Intel and PSG will maintain a strategic alignment, including their relationship with Intel Foundry Services (IFS), as they collaborate to address key areas of the FPGA market. The partnership with IFS will enable PSG to offer customers a more predictable supply aligned with their needs, ensuring a resilient supply chain.

Intel CEO Pat Gelsinger stated, "Our intention to establish PSG as a standalone business and pursue an IPO is another example of how we are consistently unlocking more value for our stakeholders. This will give PSG the independence it needs to keep growing share in the FPGA market, differentiating itself with capacity and supply resilience from IFS, and allowing Intel product teams to focus on our core business and long-term strategy."

Sandra Rivera has played a crucial role in revitalizing Intel's DCAI business, positioning it for success. She has a proven track record of driving high-impact transformations and will bring the same dedication and commitment to PSG. Intel is currently conducting a search for a new leader for DCAI.

Sandra Rivera expressed her excitement about PSG becoming a standalone business, stating, "Reestablishing PSG as a standalone business will enable us to unleash our full potential as we drive for leadership in this demanding and essential part of the semiconductor industry. Our strategic relationship with Intel will continue to be an advantage as it gives us maximum flexibility in how we address fast-growing markets like automotive and data center and communications."

Shannon Poulin added, "This is a significant inflection point for the PSG business - one that will enable us to build out a leadership end-to-end portfolio of FPGA products, while also making enhancements to our go-to-market strategy that will enable us to achieve market share growth. The investments we are making in the new company and the autonomy of execution is good news for our customers, partners, and the entirety of the FPGA industry."

According to third-party estimates, the FPGA market is projected to grow at a compound annual growth rate (CAGR) of over 9%, reaching $11.5 billion in revenues by 2027. PSG has been delivering strong results, with record revenues for three consecutive quarters. The group has also been successful in executing its product roadmap, including the launch of innovative products such as the Intel Agilex 7 with the R-Tile chiplet.

This announcement follows Intel's recent IPO for the Mobileye business and investments by Bain Capital Special Situations and TSMC into Intel's IMS Nanofabrication subsidiary. These transactions demonstrate Intel's commitment to advancing its IDM 2.0 strategy, driving growth in its core businesses, and creating value for shareholders.