Intel’s Optane Business Suffered $576 Million Operating Loss in 2020. The company has undergone a significant decrease in sales, leading to the restructuring and eventual shut down of its subsidiary. Experts believe that this is due to Intel underselling the product as it was released at reduced prices during 2019 holiday season while other competitors were offering higher performance drives with a similar price point.,
The “optane memory” is a type of storage device that uses 3D XPoint technology. Intel has announced that the company’s Optane Business suffered an operating loss of $576 million in 2020.
Image credit: Intel
It’s no secret that Intel’s Optane memory technology hasn’t exactly been a success, but new SEC filings have revealed just how much of a drain that business had been on Intel’s finances back in 2020. As spotted by Blocks & Files, Intel’s annual 10K SEC filing for 2021 reveals that Optane cost Intel over half a billion dollars that year, with operating losses in the region of $576 million. Optane memory was discontinued for the consumer market in January 2021.
Image: Blocks & Files
Optane’s 2020 half billion dollar operating loss (Blocks & Files)
- The Non-Volatile Solutions Group section (page 33) of Intel’s annual 10K SEC filing for 2021 reveals some gruesome financial details: “Revenue fell $1.1 billion as a result of reduced ASPs of $712 million owing to market downturn and price pressure, and $392 million due to the transfer of Intel’s Optane memory business to DCG.”
- […] We can see that Intel’s Optane devices resulted in a $576 million operational loss in 2020. The nine-month sales figure for 2021 was $271 million, down 9.1% from $298 million in 2020, while the Q4 revenue figure of $121 million was down sequentially from $188 million in Q3.
- Is Intel’s Optane business expected to lose money in 2021? We don’t sure, but we assume it did since operating losses in 2020 were 134.9 (Q3) to 158.7 (Q1+Q3+Q3)% greater than sales. We may predict a $529 million operating loss in 2021 if we apply the lower ratio to the $392 million full-year Optane sales.
According to a different story, Alper Ilkbahar, the head of Intel’s Optane memory division, is leaving the firm. According to a message from executive Sandra Rivera, he is leaving for personal reasons.
Alper Ilkbahar, the leader of Intel Optane, is leaving (CRN)
- Ilkbahar’s last day will be Feb. 11, and David Tuhy, who previously led Intel’s Optane and SSD software efforts, will take his place as vice president and general manager of the Intel Optane Group, according to top executive Sandra Rivera in a memo outlining changes in Intel’s Datacenter and AI Group.
- Rivera, who oversees Intel’s Datacenter and AI Group, tweeted, “It is with mixed feelings that I disclose Alper Ilkbahar has chosen to leave Intel for personal reasons.” “Alper has made several substantial contributions to Intel since joining in 1992 as a design engineer for the 486 CPU and returning in 2016 to oversee our Optane memory division,” says the company.
- “In less than three years, optane sales have climbed to $500 million,” Rivera stated in the message, which didn’t elaborate on the revenue number. She went on to say, “Alper has been a role model for Intel ideals, a world-class professional, a mentor, and a friend.”
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