Intel reportedly signs biggest foundry customer yet: Cisco

Intel reportedly signs biggest foundry customer yet: Cisco

Summary: Ahead of the quarterly earnings announcement this afternoon, Intel has reportedly signed the biggest customer yet for its growing foundry business.


Intel's venture into operating a foundry business unit might be off to a solid start, based on a new report.

Bloomberg reported on Thursday that the hardware giant has inked a deal with Cisco, which would be Intel's biggest customer yet for made-to-order chips.

Basically, Cisco would design the chips for its networking products while Intel would be responsible for actually manufacturing them.

Reports and rumors about the chip maker's interest in a foundry business have been around for awhile now.

Back in December, Intel CEO Paul Otellini commented that the company would be open to being a foundry for a strategic partner -- at least one that isn't a competitor.

Speaking during the Sanford Bernstein investor conference that month, Otellini didn't name any names, but he seemed to shy away from listing Samsung as a potential client while remaining mum about Apple.

Yet in this case, it looks like Cisco would fit the bill.

Neither Intel nor Cisco have commented publicly on the new report yet, and Bloomberg cited a pair of unnamed "people with knowledge of the matter" as its sources for the story.

We could hear more about this potential development this afternoon as Intel will be reporting fourth quarter earnings after the bell, followed by a conference call at 2:00PM PT/5:00PM ET.

Topics: Hardware, Cisco, Collaboration, Intel, Processors

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  • Intel doing contract manufacture?

    I suspect it could do brisk business in ARM based SOCs using its latest technology ;-)
    • Yes hence the "at least one that isn't a competitor" clause :)

      There are plenty of other things intel could do though and plenty of other companies that could benefit from intels huge lead in production. They should be all over these deals if they're of sufficient size.
      Johnny Vegas
      • But seriously....

        If Intel has a one shrink lead they should be able to produce ARM chips at half the price and with better performance. That should be enough to maintain margins.

        They would still have the problem of what to produce on older equipment, but they have that problem today with X86 production.

        Perhaps fabbing ARM chips is not as crazy as it first sounds.
        • Re: produce ARM chips at half the price and with better performance

          Better performance, maybe, but not half the price.

          Each chip costs only a few cents to produce-and it makes no difference whether that's an ARM or an x86 chip. The major cost being recouped is the multiple billions of dollars it took to set up the fab. And Intel's fans, being more advanced than those bring used to make most ARM chips, cost correspondingly more to build.
  • Now imagine ...

    ... if Intel returned to the ARM front, applying it's current 22nm process expertise to building SOC devices incorporating perhaps both ARM and x86 cores on a single chip.

    Such devices could open-up enormously exciting possibilities for a wide range of scenarios.