Intel Corp. shares experienced a boost in after-hours trading on Tuesday following an announcement by the chip maker regarding its plans to spin off one of its units as a public offering in the next two to three years.
Shares of Intel (INTC) rose as much as 2.5% after hours, building on a 0.7% gain in the regular session which saw them close at $35.69. In contrast, the S&P 500 index (SPX) fell 1.4% on Monday, with the tech-heavy Nasdaq Composite (COMP) experiencing an even greater decline of 1.9%.
Intel revealed its intention to operate its programmable solutions group (PSG) as a standalone business starting from January 1. This move will be reflected in the company's first-quarter 2024 earnings report, where PSG will be reported as a separate unit.
Sandra Rivera, Intel's current head of the data-center and AI group, will assume the role of chief executive of PSG. Rivera will continue to manage the data-center group until her successor is appointed.
Unlocking More Value
Pat Gelsinger, Intel's chief executive, commented, "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." Gelsinger emphasized that this step will provide PSG with the independence required to bolster its market share in the field programmable gate arrays (FPGAs) market. Furthermore, it will enable Intel's product teams to focus on the company's core business and long-term strategy.
Intel has scheduled a conference call for Tuesday at 2 p.m. Pacific or 5 p.m. Eastern.