Источник изображения: Intel

Intel can save up to $ 2 billion annually after SK Hynix deal

Intel this week agreed with SK Hynix to sell its NAND solid state memory business. Until March 2025, Intel will be able to receive silicon wafers produced at an enterprise in Dalian, but then this Chinese asset will become the property of SK Hynix. Experts believe that the deal will help Intel save up to $ 2 billion annually.

Image source: Intel

Image source: Intel

Intel’s solid-state memory business broke even this year alone, after losing six quarters in a row. The development of memory production required significant investments from the company. It would seem that after such multi-billion dollar investments it would not be entirely reasonable to sell the business, but analysts at Raymond James have determined that without such “ballast” Intel will be able to release up to $ 2 billion annually for other purposes.

SK Hynix is ​​also interested in this deal, since in 2019 it would increase its market share to 20%, as experts at BMO Capital Markets explain. Their colleagues at RBC are concerned about the possible impact of the deal between Intel and SK Hynix on the lithography equipment market, since if the Korean memory manufacturer wants to dramatically increase production, then the demand for specialized equipment will also increase.

The most interesting thing is that this news did not provide any support to Intel shares, but Western Digital Corporation and Micron Technology shares rose by 10.2 and 3.5%, respectively. SK Hynix has some chances to become the second largest manufacturer of solid state memory after completing its deal with Intel.

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