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Intel CEO Talks Apple Deal, China In CNBC Interview

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Intel CEO Talks Apple Deal, China In CNBC Interview

Intel Corporation (NASDAQ: INTC) CEO Bob Swan said in a CNBC interview the company's decision to sell its modem business to Apple Inc. (NASDAQ: AAPL) was based on its view that only serving Apple was "unattractive."

5G Strategy

Intel's largest opportunity within the 5G universe is within the "cloudification of the network," that is more infrastructure moving away from traditional data centers towards cloud based technology, the CEO told CNBC. This represents a "significant" opportunity for Intel to address as opposed to the smartphone 5G modem business where the market opportunity is much less.

Intel's 5G modem business also sold to just one customer and there was no clear path to generating attractive returns for investors, he said. As part of the agreement, Intel retains the right to develop 5G modem for non-smartphone use, like auto, he said.

China Exposure

Intel wants to continue servicing its global customers but will do so within the rules set forth by the recent Chinese no-trade "entity list," Swan said in the interview. Once the list was released the company paused all shipments to China as was the case across the entire semiconductor industry.

Intel quickly made a determination what products it can ship to Chinese clients and continued to do so in the second quarter, he said.

Next step for Intel is to wait for approval from the U.S. government to continue shipping to Huawei. The U.S. government indicated over the past week it will process licenses at a quick pace.

Price Action

Shares of Intel were down 1.58% at $49.74 at time of publication.

Related Links:

Intel Analyst Plays Down Beat-and-Raise Quarter Amid Caution Over Second-Half Fundamentals

Analyst: Why Apple's Potential Purchase Of Intel's Modem Businesses Could Be Positive For Sequans

Posted-In: 5G Bob Swan China cloudNews Contracts Tech Media Best of Benzinga

 

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