The deal, announced Monday, values Altera at just $8.75 billion—less than half of the $17 billion Chipzilla dropped on it in 2015. But it brings in badly needed cash after Pat Gelsinger’s ill-fated manufacturing push left the company financially winded.

Intel chief Lip-Bu Tan: "Today's announcement reflects our commitment to sharpening our focus, lowering our expense structure and strengthening our balance sheet,"

Tan’s strategy is simple: gut everything that isn’t PC or server chips. Years of dithering left Chipzilla flailing as Nvidia conquered AI and AMD carved up the CPU market. Altera, spun out last year, was ripe for the chopping block.

The unit pulled in just $1.54 billion in 2024—only three per cent of Intel’s revenue—and posted an ugly $615 million operating loss. Chipzilla’s plan to yank production from Taiwan’s TSMC and build chips in-house only made things worse, handing ground to AMD’s Xilinx.

Raghib Hussain, formerly of Marvell, will replace Sandra Rivera as Altera chief on 5 May.

Gabelli Funds portfolio manager Hendi Susanto, whose firm holds Intel stock said: “The divestiture of Altera is at a market down-cycle and at the bottom of Altera's sales performance. It is not the best time to sell Altera's stake."

Still, “some investors may see the transaction more positively in terms of Intel strengthening its focus on its core businesses,” Susanto added.

Bob O’Donnell, chief analyst at Technalysis Research, reckons more cuts are coming.

Mobileye Global, the autonomous driving firm Intel still owns, is considered “non-core.” Chipzilla CFO David Zinsner said in December the company could sell more of its stake and “use the cash.”