Intel announced it will retain its Networking and Communications (NEX) unit after a comprehensive strategic review. The decision follows a period during which the company explored selling the unit and ended talks with Ericsson over a minority stake. By keeping NEX in-house, Intel aims to deepen integration between its silicon, software, and systems businesses, especially in AI, data‑center, and edge‑computing markets.
The NEX division, which designs processors for networking and edge devices—including infrastructure processors, Ethernet and Wi‑Fi controllers, and switching gear—contributes roughly $1.6 billion in sales and $300 million in operating income in Q4 2024, according to the last separate reporting. In 2024, Intel reported $5.8 billion in revenue for the unit, a figure that reflects the broader integration of NEX into the Data Center and AI (DCAI) and Client Computing Group (CCG) segments beginning in Q1 2025.
Management explained that the review considered a standalone path for NEX, a sale, or a spin‑off, but concluded that the unit’s strategic fit with Intel’s core silicon and AI initiatives outweighed the potential cash proceeds. “Keeping NEX in-house enables tighter integration between silicon, software and systems, strengthening customer offerings across AI, data center, and edge,” a company spokesperson said.
The decision comes amid a broader turnaround for Intel. Recent capital infusions—including $8.9 billion from the U.S. government, $2 billion from SoftBank, and $5 billion from Nvidia—have bolstered the company’s cash position and reduced the need to raise capital through divestitures. The company’s Q3 2025 earnings, released in October, beat expectations with revenue of $13.7 billion and EPS of $0.23, underscoring the confidence that management has in its integrated strategy.
By retaining NEX, Intel positions itself to capture synergies across its product portfolio. The unit’s hardware expertise complements Intel’s AI platform, while its software stack supports the company’s edge‑computing ambitions. The move signals a shift from earlier plans to spin off or sell non‑core assets, reinforcing CEO Lip‑Bu Tan’s focus on streamlining operations and concentrating resources on high‑growth areas.
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