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Micron Ends Intel's 3D XPoint Chip Development Partnership, Plans Factory Sale: Bloomberg

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Micron Technology Inc (NASDAQ: MU) is ending the 3D XPoint chip development partnership with Intel Corp (NASDAQ: INTC) and selling the factory in Lehi, Utah, Bloomberg reports.

  • The two U.S. companies previously claimed the market-changing abilities of the 3D XPoint chips by operating as storage and a fast-access aid to processing. However, the business no longer justified the continued development expense for Micron.
  • Micron’s decision was a setback to Intel’s attempt to reaffirm its influence over the previously dominated memory chip business.
  • Micron preferred to sell the Utah plant to expand other sites in Singapore, Taiwan, and Japan, emphasizing scale and cost competitiveness.
  • The move amid the ongoing chip crisis reflects the ruthless industry dynamics as fully paid older plants failed to contest their bigger and more contemporary counterparts.
  • Micron was evaluating offers received for the factory. The plant equipment was meant for the manufacture of logic or analog chips or outsourced production.
  • Micron’s decision did not affect Intel’s strategy for Intel Optane, or the ability to supply Intel Optane products, the company clarified. Optane was the brand used by Intel for products based on the 3D XPoint chips.
  • The technology abandonment and factory sale would help Micron improve its annual profitability by $400 million as per the company. 
  • Price action: INTC shares are trading lower by 0.65% at $64.36, while MU shares traded higher by 1.78% at $93.06 on the last check Wednesday.
 

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Posted-In: BloombergNews Asset Sales Tech Media

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